Syz the moment

"Despite $1.5tn spent in past 3 years, scant evidence yet of economy-wide productivity gains; in fact, total factor productivity is falling below trend, a measure highly correlated the past 50 years with consumer confidence; sometimes Main St knows what Wall St doesn’t" - BofA, Michael Hartnett Source: zerohedge

“Safe” bank bonds now yield less than French government debt. French 10-year covered bonds—secured by ring-fenced pools of mortgages—now offer a lower yield than 10-year sovereign bonds. In other words, markets are pricing a pool of French home loans as safer than the French state itself. Why? France’s public debt has reached 117% of GDP. The government plans a record €310 billion of bond issuance in 2026. Meanwhile, the 10-year yield spread over Germany has widened to 90 basis points—the highest since 2012. This is more than a technical distortion. When government bonds trade at a discount to the bank debt they ultimately backstop, investors are sending a clear message: The sovereign balance sheet has become the risk. Bond markets often discipline governments long before voters do. Source: Kurt S. Altrichter, CRPS

Since 1998 the index has needed a median of 578 trading days to clear each 1,000-point level. At that pace 8,000 doesn't land until around mid-2028, and SPX just closed lower every day this week at 7,591. Betting on 8,000 this year puts you early by about 18 months. Of course, if you start thinking in % terms things look very different. Which makes this analysis flawed. Source: Bloomberg

Saudi Arabia’s East–West pipeline was reportedly shut down on Friday following recent attacks, potentially affecting around 4 million barrels per day of export capacity. At the same time, risks around the Bab el-Mandeb Strait could threaten flows of up to 9 million barrels per day, while the Strait of Hormuz is reportedly operating at roughly 20% of its pre-war capacity. Taken together, close to 30 million barrels per day of oil flows may be disrupted or exposed to disruption. There is some overlap between these routes, so the figures should not simply be added together. Still, against a global oil market of roughly 100 million barrels per day, the potential impact is significant. This does not necessarily mean a lasting supply shock—but it highlights how vulnerable global energy markets have become. Source: The Kobeissi Letter

Source: BofA

As you can see, it initially dropped around 5% on the news, but it has now recovered and is basically back to where it was. Source: Arkadi

Gulf states postponed a planned meeting with Iran in Oman aimed at managing shipping through the Strait of Hormuz, due to lack of consensus among GCC members. The meeting would have been the first GCC-Iran ministerial gathering in nearly two years, focused on a Tehran-Muscat deal to temporarily manage traffic through the strait, which Iran has restricted since the US-Israel war against it began in February. Oman's foreign minister announced the postponement without details, citing commitment to dialogue. Bahrain, hit hard by Iranian retaliatory strikes and holding the GCC presidency, had already said it would skip the meeting. The setback comes as Saudi Arabia faces a separate crisis: a Thursday drone attack, launched from Iraq where Iranian-backed militias operate, forced closure of a pipeline carrying oil from its eastern fields to the west coast. That pipeline has become critical for Saudi exports since Hormuz traffic was disrupted. Source : FT

Q1 FY2027 delivered a major datapoint for the AI bull case: Oracle’s trailing 12-month operating cash flow reached $46.9 billion. • +118% year-on-year • +47% quarter-on-quarter • Nearly $15 billion added in one quarter Yes, Oracle’s capital expenditure remains enormous. But that is precisely the strategy: build the computing and data-center capacity needed to serve one of the industry’s largest contracted AI backlogs. The key question was whether this massive infrastructure investment would eventually translate into revenue and cash generation. As capacity comes online and remaining performance obligations convert into sales, the answer is becoming clearer. AI infrastructure is moving from capital expenditure… …to cash flow. $ORCL Source: Steven Fiorillo