Will the equity market follow the historical script around geopolitical shocks
"The historical playbook is for a sharp selloff of about -6% to -8% but a bottom on average in 3 weeks, and a full recovery in another 3, usually long before the underlying escalation is resolved. The current selloff is in the vicinity of a typical bottom in size and timing." - Deutsche Bank Source: Sam Ro @SamRo DB
U.S. Energy Ultimatum to Europe: Strategic Pressure for Long-Term Dependence
President Donald Trump demands Europe sign a $750B energy deal or lose U.S. LNG access. With supply constrained (Qatar offline, Russia absent, Norway maxed, prices up 35–50%), the U.S. dominates EU LNG (57%). Tensions with Iran spike oil, then ease to influence markets. The deal locks Europe into LNG, oil, and nuclear dependence by 2028, mirroring Russia’s parallel strategy in Asia.
Today is the six-year anniversary of the COVID Crash low.
The S&P would need to fall 66% to get back to that level. Source: Bespoke
Trump’s “ceasefire” is only a partial pause
Trump announced a five-day pause on strikes against Iranian energy infrastructure, following a 48-hour threat that Iran ignored. Meanwhile, missile attacks continue, Hormuz remains closed, and 4,500 Marines are still deploying. The pause applies only to energy strikes; all other military actions continue. Media frames it as diplomacy, Iran sees a win, and the bond market reacts with volatile yields. The real indicator of impact will be market behavior, not political statements. Source: The Kobeissi Letter, Whale Guru on X
Private credit exploded over the past decade
Source: The Icahnist
The biggest elephant in the room IS NOT stocks, it is the bond market
The US 10-year Treasury yield spiked +13 basis points on Friday to 4.38%, the 2nd-largest single-day jump since the April 2025 Liberation Day sell-off. Since early March, the 10-year yield has surged +45 basis points, the fastest rise in nearly a year. The bond market sell-off is being driven by soaring oil prices fueling inflation fears, hawkish signals from the Fed and Bank of England, and hedge funds being forced to unwind leveraged bond trades at a loss. If yields rise another 20 to 30 basis points from here, it could trigger a liquidation cascade across all asset classes as institutional trading desks would have no choice but to slash risk exposure, similarly to April 2025. Source: Global Markets Investor
Energy power depends on infrastructure, not reserves
In 2026, global gas reserves tell a misleading story: Russia, Iran, and Qatar hold over 50% of reserves, yet disruptions, sanctions, and conflict limit output. The US, with only ~5% of reserves, dominates through operational export terminals, LNG shipping, and intact infrastructure. The lesson: energy power comes from extraction, processing, and logistics not the size of reserves. Gas in the ground or stranded by damaged infrastructure holds no real value; the strategic asset is functional infrastructure. Source: Jack Prandelli on X
Gold drops signal rising market stress
In just three hours, gold fell ~$400, silver ~14%, erasing ~$2 trillion, defying its usual “safe haven” role amid geopolitical tension. This unusual behavior suggests large institutions may be raising cash quickly, liquidity is valued over safety, and hidden market stress could be building. Concurrently, oil retraced gains, futures remain stable, and insider selling has been heavy. Together, these signs indicate that markets react to pressure more than headlines, and even traditionally safe assets can be sold. Source: LimitLess
