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With war in the middle east raging, and the world's most important oil transit choke point - the Straits of Hormuz which accounts for 20% of daily global oil transit - "effectively" halted after at least three ships were attacked in the vicinity of the waterway - even as Iran’s Foreign Minister Abbas Araghchi told Al Jazeera TV his country has no intention to close the Strait of Hormuz and has kept it open so far, markets have just one question: where does oil open when futures resume trading in a few hours. 

Well, we can tell you: according to the IG Weekend Market, an OTC market that reflects prices across over the counter exchanges, oil is set to open more than 10% higher, with spot WTI trading around $75 and Brent set to rise over $80.

That's not the question: the question is where does oil trade in a week, a month, a year, and - tied to that - what happens to the oil price curve.

The price spike comes despite OPEC+’s announced modest supply hike. But for such gains will sustain, or extend, investors will need to decide that the conflict is going to drag on. Indeed, this new wave of war is bigger, broader and messier than last June’s fighting. The gap between attacks and retaliation has narrowed: In previous waves it took days, but now it’s hours.

As Bloomberg's Garfield Reynolds reminds us, during the 2003 invasion of Iraq by US-led forces, crude actually tumbled at the start of hostilities, on speculation the US would achieve a rapid victory. It ended up rebounding from an April trough to enter a long uptrend as it became clearer that there would be no straightforward resolution. 

The stakes are higher for oil this time. Iran’s output accounts for more than Iraq’s did in 2003, and Iraq had much less capacity to threaten the Strait of Hormuz. Iran has said it doesn’t plan to close the key shipping channel, but there have already been signs that the conflict is halting tanker traffic.

“Tankers are starting to build by the Strait of Hormuz, but nothing seems to be going through at the moment – tankers are definitely spooked,” said Matt Smith, oil analyst at energy consulting firm Kpler.

That means any lack of clarity on the endgame increases the potential for sustained advances in crude over the coming weeks. Any signs of a prolonged and drawn-out struggle boost the likelihood of crude reaching $80 a barrel and beyond, with Bloomberg Economics outlining a scenario that sees oil spiking above $100 in an extreme disruption scenario.

Sure enough, Middle East leaders have warned Washington that a war on Iran could lead to oil prices jumping to over $100 per barrel, said veteran OPEC analyst Helima Croft from RBC. Analysts from Barclays also said prices could rise to $100.

Other analysts see a more modest jump depending on how the conflict develops. Prices should rise by at least $3 to $5 per barrel when trading starts, said Andy Lipow, president of Lipow Oil Associates. 

The worst-case scenario is an attack by Iran on Saudi oil infrastrucure followed by a complete closure of the Strait, Lipow said Sunday. Oil prices would jump by $10 to $20 in this scenario, the analyst said, which he put at a 33% likelihood. 

And so, while the world waits to see next steps, it's buying oil and asking questions later. The attacks already are much wider in scope than last June. Iran’s response already has gone beyond the retaliation it offered in the opening stages of June’s war.

For its part, Bloomberg's economists thing Iran’s response will continue to escalate. While it can’t match the US’ military superiority, Iran can impose significant costs and seek to bog the US down in the region. Iran’s targets already include US bases in the region and Israel. Tehran could expand to energy infrastructure and regional shipping routes, either directly or through its partners in the region. That includes the Houthis in Yemen, who’ve said they’ll resume their disruption of shipping in regional waters. The possible outcomes are laid out in the chart below.

The price of oil will ultimately be determined by where the war finds its equilibrium point. 

In a possible indication that the oil price spike will be brief, Trump said Sunday that Iran wants to talk and he has agreed to do so, leaving open the possibility that there might be a path to de-escalation that avoids a big, prolonged disruption.

“They want to talk, and I have agreed to talk, so I will be talking to them,” Trump told The Atlantic on Sunday. The president told CNBC that U.S. military operations in Iran are “ahead of schedule.”

On Sunday, OPEC+ agreed to boost oil output by 206,000 barrels per day for April just as the U.S.-Israeli war on Iran and Tehran's retaliation disrupted oil flows from key members of the producer group in the Middle East.

It had debated options ranging from 137,000 bpd to 548,000 bpd, according to five sources. The agreed increase, which brings an end to a three-month pause in production hikes, represents less than 0.2% of global supply.

The meeting on Sunday involved only eight members of OPEC+ - Saudi Arabia, Russia, the UAE, Kazakhstan, Kuwait, Iraq, Algeria and Oman. OPEC+ groups the Organization of the Petroleum Exporting Countries and allies like Russia but most production changes in the past years have been done by the eight members. Iran, perhaps understandably, was missing. The eight members raised production quotas by about 2.9 million bpd from April through December 2025, roughly 3% of global demand, before pausing increases for January to March 2026 due to seasonal weakness.

OPEC+ has traditionally raised oil output to cushion disruptions but analysts quoted by Reuters, said the group currently has little spare capacity to add to supply, except for its leader Saudi Arabia and the United Arab Emirates, which will also struggle to export oil until navigation in the Gulf returns to normal.

Riyadh has been increasing oil production and exports in recent weeks by around 500,000 bpd in preparation for US strikes on OPEC+ member Iran, sources also told Reuters.

The near-term impact on oil prices remains unclear: oil, gas and other shipments from the Middle East via the Strait of Hormuz have come to a halt since Saturday after shipowners received a warning from Iran saying the area was effectively closed for navigation. There was confusion later in the day, when Iran’s Foreign Minister Abbas Araghchi told Al Jazeera TV his country has no intention to close the Strait of Hormuz and has kept it open so far. 

Hundreds of ships dropped anchor and were not moving on Sunday and several ships came under attack, as reported earlier. Hormuz is the world's most important oil route accounting for over 20% of global oil transit.

Despite fears of a glut that would weigh on prices, global benchmark Brent crude has rallied this year and jumped on Friday to $73 per barrel, the highest level since July, on fears of a wider conflict in the Middle East. In other words, as nat gas trading legend John Arnold (first at Enron then at Centaurus) much of the conflict is already in the prices, although what happens next depends on how long any Hormuz closure lasts. As Arnold also explains, while the market was somewhat hopeful a war could be avoided, Iran’s response thus far suggests a below expectations ability to materially disrupt supply which would suggest any oil price spike is temporary.

re: oil prices
- Oil had already rallied ˜$7 from late January in anticipation of possible attack
- Market was still assigning some probability to no attack (bullish)
- Iran’s response thus far suggests a below expectations ability to materially disrupt supply (bearish)

— John Arnold (@johnarnold) March 1, 2026

While oil may be volatile in the near-term, there is less doubt what happens to shipping charters in coming days: they will soar. As the FT reported, insurers told ship owners on Saturday they would cancel policies and raise coverage prices for vessels traveling through the Gulf and Strait of Hormuz after the US and Israel attacked Iran.

War risk insurers on Saturday submitted cancellation notices for policies covering ships moving through the key oil chokepoint, brokers told the FT, with prices set to rise as much as 50% in the coming days. The unusual move to submit these notices before trading resumes on Monday underscores the pace of escalation after Iran launched retaliatory strikes against US bases across the Middle East. 

Insurance prices for ships travelling through the Gulf had been about 0.25 per cent of the replacement cost of a vessel. They could now jump by as much as half, Dylan Mortimer, marine hull UK war leader at broker Marsh, told the FT.

For a $100mn vessel, this would mean an increase from $250,000 to $375,000 per voyage.

Of course, the greatest concern among underwriters is whether Iran would close the Strait of Hormuz: Insurers were also pricing in expectations that Iranian proxies may attempt to board and seize vessels, he added.

“If Israel and US are continuing to strike Iran . . . it’s more likely that Iran will start trying to leverage their control via the manipulation of shipping in the region,” Mortimer said.

As a result of the regional war, some ship owners are now fully turning away from the Strait of Hormuz, through which about a fifth of the world’s crude oil flows. On Saturday at least three ships turned away from the strait, rather than pass through it, as shipowners assessed the risk of being attacked in the narrow waterway.

Yet the probability of a long-term Straits shutdown will be mitigated by an unlikely source: some 80% of Iran's oil exports, about 1.6 million barrels per day, go to China, and Beijing will do everything in its power to preserve this lifeline and remove any Hormuz blockage...

... as will Iran because after a few days of zero revenue, the regime - which is being bombed constantly by the US and Israel - will be in desperate need of cash to keep the military happy. 

Going back to OPEC+ output increase, Jorge Leon, a former OPEC official who now works as head of geopolitical analysis at Rystad Energy said it is unlikely to calm markets. Indeed, Brent traded 8%-10% up around $80 per barrel over the counter on Sunday, traders said.

"Prices will respond to developments in the Gulf and the status of shipping flows, not to a relatively small increase in output."

Middle East leaders have warned Washington that a war on Iran could lead to oil prices jumping to over $100 per barrel, said veteran OPEC analyst Helima Croft from RBC. Analysts from Barclays also said prices could rise to $100.

Croft said the market impact from any OPEC output increase will be limited due to a lack of production capabilities outside Saudi Arabia.

"A tighter market in the first quarter allows the group to continue increasing the quota, however real barrels being added to the market will be a fraction of it," said Giovanni Staunovo, an oil analyst at UBS. OPEC+'s declining level of spare capacity might have been a factor behind the decision not to opt for a larger boost, he said.

Shocking new details are emerging about 12 hours after the horrific mass shooting at a downtown Austin, Texas, bar early Sunday, with New York Post sources indicating that the deceased shooting suspect, Ndiaga Diagne, a U.S. citizen born in Senegal and living in Texas, allegedly carried out the attack that left three people dead and 14 injured including three in critical condition, with federal agents examining whether the attack was potentially motivated by US-Iran conflict.

Austin Police Chief Lisa Davis told reporters that officers arrived at Buford's bar, a popular beer garden on West Sixth Street in the downtown metro area.

The early investigation shows that Diagne circled the block around the bar several times in an SUV before the shooting, Davis said at a news conference.

BREAKING: @FoxNews has obtained a photo of the Austin, TX mass shooter, armed & wearing a sweater that says “Property of Allah”. He has not been identified by authorities, but multiple federal law enforcement sources tell FOX he is a 53-year-old naturalized US citizen who was… pic.twitter.com/YjyT8sIuBr

— Bill Melugin (@BillMelugin_) March 1, 2026

Footage posted on X of the aftermath of the mass shooting is absolutely horrifying.

??Update: Iranian Sleeper Cells! FBI believes the mass shooting at a bar in Austin, Texas, that killed three and injured 14 was an “act of terrorism!” pic.twitter.com/E6gNr2eMEn

— US Homeland Security News (@defense_civil25) March 1, 2026

Alex Doran, a special agent with the San Antonio FBI field office, told reporters that the agency is working with local police on the investigation.

?? BREAKING: The Senegalese Islamist mass shooter in Austin, TX has been identified as 53 y/o Ndiaga Diagne

He was wearing a “PROPERTY OF ALLAH” shirt during the attack, per @chiproytx

MORE innocent American victims of Islamic terror by someone who SHOULDN’T HAVE BEEN HERE!… pic.twitter.com/MM5PKiOKck

— Nick Sortor (@nicksortor) March 1, 2026

"There were indicators that on the subject and in his vehicle that indicate potential nexus to terrorism," Doran said. "Again, it's still too early to make a determination on that."

I’ve heard from multiple sources that the Austin shooter wore a shirt saying “Property of Allah.” - in addition to Quran in car, and naturalizing from Senegal just over a decade ago. https://t.co/KuGXx4MfBt

— Chip Roy (@chiproytx) March 1, 2026

Diagne is a naturalized citizen from Senegal who has been in the U.S. for 15 years. Sources told NYPost that the shooter had a Quran in his vehicle and was dressed in clothing described as Islamic garb when he fired on the bar with a handgun, as well as a long rifle.

UPDATE: Per multiple federal law enforcement sources to me & @Brooketaylortv, the Austin, TX mass shooter was wearing clothing that had the words “Property of Allah” on it and was possibly wearing an undershirt/T-shirt that had an Iranian flag or Iranian representations on it.

— Bill Melugin (@BillMelugin_) March 1, 2026

Sources told NYPost that investigators are examining whether the gunman may have been motivated by the U.S. strikes on Iran earlier in the day.

The shooting is likely to intensify scrutiny of U.S. border security and mass migration threats already in the Homeland, especially as former CIA targeting officer Sarah Adams has repeatedly warned about foreign-trained Islamists already on U.S. soil.

The question is whether this was an isolated incident (lone wolf) or an early signal of an emerging threat cycle, where the strike on Iran could accelerate copycat attacks and or activate terror cells.

You can already hear some liberals and left-leaning libertarians now:  "He paid for his crime, right?  So what's the problem? What about the politicians mentioned in the Epstein files...?"

But "whataboutism" is not a valid argument for rationalizing societal decay.  And if America isn't capable of applying the most basic standards at the lowest levels of government, then America is lost.

Rene Campos, a registered sex offender, is seeking elected office in California - launching a campaign for Fresno City Council amid fierce backlash and renewed questions about whether someone with his record should hold public office.

Campos was arrested in 2018 following a cyber tip to the Central California Internet Crimes Against Children Task Force.  He was found in possession of child sex abuse material, according to court records. In 2021 he entered a no-contest plea to a single misdemeanor charge of possessing and controlling child pornography/child sex abuse material (likely under California Penal Code § 311.11).  He served only one month in prison and a two year probation period.

Campos describes himself as a gay man who is running for office on the platform of "reduced crime and rehabilitation."

  

Possession of child pornography is typically treated as a felony, even in a woke haven like California.  How the Fresno candidate was able to make a deal for a misdemeanor charge and spend only one month in prison is a mystery, but this does help to confirm ongoing suspicions that California's legal system is falling into steep decline. 

California is notoriously soft on child sex abusers.  Recently, a Sacramento parole board released Daniel Allen Funston, who was convicted in 1999 of sixteen counts of kidnapping and child molestation after a horrific crime spree in Sacramento County, during which he kidnapped, raped, and beat eight children ages 3 to 7. 

Funston was originally sentenced to three consecutive life terms plus 20 years, but was set free at age 64 due to a California elderly inmate program (maybe he'll run for office, too).  

Data from 2022 shows that the Golden State released over 7000 child sex offenders after less than one year of incarceration.  Interestingly, "digital blocks" were added to the Megan’s Law website that prevent more recent analysis. 

State Senator and LGBT activist Scott Weiner has supported multiple pieces of legislation that help to reduce punishments for sex offenders.  He authored a bill in 2017, signed into law, which created a three-tier sex offender registry system in California. It allows some "lower-risk" offenders (including those convicted of misdemeanor possession of child pornography) to petition for removal from the registry after 10-20 years (Tier 1 or 2), rather than lifetime registration. 

Perhaps the most disturbing factor is that in California a candidate like Campos actually has a good chance of winning.  He is a member of the LGBT community, a minority, and he appeals to the progressive desire to prove that laws are "artificial constructs" and that criminal convictions should not "define a person."  In other words, Campos could win the election simply because he gives leftists an opportunity to prove that even the worst criminals are merely downtrodden victims who were never given a chance to succeed.   

Authored by Lance Roberts via RealInvestmentAdvice.com,

As we will discuss further in today’s commentary, the market remains stuck in a fairly narrow trading range. The week opened with a broad selloff after Anthropic’s expanded AI capabilities rattled software, cybersecurity, and financial stocks, with IBM suffering its worst session since 2000. CrowdStrike and Zscaler also dropped about 10% on the news. The financials sector fell more than 3% as American Express, Goldman Sachs, and Blackstone came under pressure on fears that AI could automate large portions of their businesses. A widely circulated Citrini Research piece warning of 10% AI-driven unemployment gave bears a macro narrative.

Yet the “AI kills everything” narrative ignores what the data actually shows: companies are integrating AI, not dying from it. McKinsey’s 2025 State of AI survey found 88% of firms already use AI in at least one business function, up from 78% a year prior, while by Q1 2026, that figure reached 78% of U.S. corporations scaling AI enterprise-wide, according to Netguru. Salesforce’s Q4 2026 earnings showed over 22,000 Agentforce deals closed in the quarter, with combined AI and Data Cloud ARR surging to $1.8 billion from $1.4 billion just three months earlier, proving enterprise buyers are choosing to buy AI tools from incumbents rather than be replaced by them.

Deloitte’s 2026 State of AI in the Enterprise report found that two-thirds of organizations already report productivity and efficiency gains, while a Harvard study showed that consultants using AI completed tasks 25% faster and at 40% higher quality, augmentation, not elimination. Goldman Sachs Research estimates AI-driven productivity could lift global GDP by 7% (roughly $7 trillion) and sees the next phase of the AI trade rotating precisely toward “productivity beneficiaries,” the non-tech companies that harness AI to widen margins.

Meanwhile, LPL Research notes that BLS data already shows real output rising 5.4% while hours worked grew just 0.5%, and that only 5.7% of U.S. job hours currently involve generative AI, meaning the largest productivity gains are still ahead, not behind us.

The crucial point to consider is that the IBM selloff and SaaS panic of this year may ultimately look less like the beginning of a displacement cycle and more like the kind of reflexive fear that preceded every prior wave of technological adoption. We have seen this same cycle, from ATMs (which reduced bank teller employment) to cloud computing (which expanded, not destroyed, enterprise software). Notably, the companies that adapt capture outsized value, and the ones that don’t were already failing for other reasons.

The main event came on Wednesday after the close. Nvidia reported fiscal Q4 revenue of $68.1 billion, beating the $65.9 billion consensus by 3.3%. Notably, it guided Q1 to $78 billion, well above the $72.8 billion estimate. Data center revenue totaled $62.3 billion, up 75% year over year. However, the stock still fell 5% on Thursday as investors flagged a lack of detail on lingering China uncertainty. However, Nvidia currently trades at a deep discount to the broad market index. While the S&P trades near 22x earnings, Nvidia’s forward PE is 17x with a 0.45 price-to-earnings-growth ratio. With EPS expected to grow by 39.2% over the next 5 years, the fundamentals are compelling. By focusing on a possible future event that may or may not occur, they may miss a fundamentally strong company trading at a discount.

The big risk worth watching is that tariff policy remains in legal limbo after the SCOTUS ruling. The AI disruption narrative is broadening beyond software into financials and logistics. And the extreme rotation into Energy, Materials, and Industrials (up 21%, 17% and 12% respectively) has left positioning dangerously one-sided against Technology.

Resilience is not the same as safety.

Which brings us to the market.

Market Topping Process? Yes or No.

The question facing equity investors in early 2026 is deceptively simple: Is the stock market topping? This was a topic we touched on in Wednesday’s #DailyMarketCommentary:

“Technically, the market looks weak, as shown in the chart below. Momentum continues to fade along with Relative Strength. Furthermore, the market has been making lower highs as of late and is threatening to break important support at the 100-day moving average.”

Greg Feirman also touched on this concern, noting:

“While the S&P is only about 2% off its all-time highs, beneath the surface the market is showing signs of a top. Warren Pies tweeted today that there have been only two other times when Consumer Staples and Energy were up more than 10% and Technology and Financials were negative over the previous 63 trading days: 1990 (Desert Storm) and 2000 – both of which were market tops. Health Care – another defensive sector – has also been outperforming the S&P of late.”

Another warning came from the recent triggering of a “Hindenburg Omen.” The last time we discussed this warning was in early November:

Bottom line: market breadth is horrendous and will likely lead to a rotation favoring out-of-favor sectors and stocks. Thus, it’s not surprising that the Hindenburg Omen was triggered. If we continue to see more of these Omens, the threat of a drawdown grows.

At the time, Mega-Cap stocks were grossly outperforming the market, while many sectors lagged the market. Since that Hindenburg Alarm, our expectations have come to fruition. We have, in fact, seen a “rotation favoring out-of-favor sectors and stocks.” Over the last month, the Hindenburg Omen has sent 6 alarms. The last batch of Hindenburg alarms signaled drawdowns in the leaders and strong performance in the laggards.

Lastly, as discussed over the last few weeks, the problem with the potential market-topping process is the divergence between the defensive names, which are extremely overbought, and the growth names, which are extremely oversold. However, those growth names are where the earnings and revenue growth reside. With that in mind, the next rotation could be from defensive names back to growth names, which are now trading at significantly lower forward PEs. Such a rotation would be exactly what often happens, as no one currently expects it.

If it isn’t a market top, then is the recent rotation out of growth and into defensive sectors merely the kind of healthy digestion that precedes a further leg higher?

These are the questions we will dig into today.

The Case for a Top: What the Bears See

The S&P 500 has spent recent weeks grinding in a range that has tested the patience of both bulls and bears. More notable than the index’s headline price action has been the dramatic shift beneath the surface: utilities, healthcare, and consumer staples have led the tape, while the mega-cap technology stocks that powered the bulk of the post-2022 rally have stalled or retreated. The Nasdaq 100’s underperformance relative to the equal-weight S&P 500 has reached levels not seen since the first quarter of 2022, a period that, it bears noting, preceded a punishing bear market leg.

For market technicians, the pattern is uncomfortably familiar. Market-topping processes throughout history, from 2000 to 2007 to 2021, have been preceded by precisely this kind of internal deterioration: narrowing leadership, defensive outperformance, and a growing divergence between price-weighted and breadth-based indicators. The question is whether history is rhyming again, or whether the analogy is misleading.

The most compelling argument that equities are in a market-topping process begins with the market’s internal structure. When investors rotate aggressively into utilities, staples, and healthcare sectors prized for their dividend yields and earnings stability rather than their growth prospects, it is typically a signal that institutional capital is seeking shelter. Money doesn’t move into Procter & Gamble and Duke Energy because portfolio managers are feeling adventurous. It moves there because they are seeking relative safety.

The breadth picture reinforces this concern. The percentage of S&P 500 constituents trading above their 200-day moving average has been declining even as the index itself has held near its highs, a classic negative divergence. We also see the same negative divergence in the market’s relative strength measures. In past market-topping processes, such divergences have preceded meaningful corrections by 2 to 6 months.

Then there is the yield curve. After a prolonged inversion that began in 2022, the curve’s re-steepening in late 2024 and into 2025 prompted some relief among investors who viewed the normalization as a sign the recession everyone feared had been avoided. But historically, the most dangerous period for equities is not during the inversion itself; it is in the 12 to 18 months after the curve un-inverts. The logic is straightforward: the curve steepens because the Fed is cutting rates in response to slowing growth, and the lagged effects of prior tightening are still working through the economy. By the time the damage becomes visible in earnings, the market-topping process has likely been completed.

Lastly, credit markets, while not yet flashing red, are showing early signs of strain. Investment-grade and high-yield spreads have widened modestly from their tightest levels, and dispersion within the high-yield market, particularly in private credit, has increased. Historically, credit leads equities, and the subtle deterioration in risk appetite in fixed income is difficult for equity bulls to dismiss entirely.

But let’s also discuss the bull case.

The Case for a Base: What the Bulls See

The bull case is not built on dismissing the rotation into defensives but on reframing it. Proponents of the view that the market is building a base, rather than a market-topping process, and point out that leadership transitions within a bull market are not inherently bearish. In fact, some of the healthiest and most durable advances in market history have been accompanied by exactly the kind of broadening and rotation currently underway.

Consider the precedent of 2016. After a narrow, FANG-led rally in 2015, the market experienced a gut-wrenching correction in early 2016 driven by growth fears and an oil price collapse. What followed was not a bear market but a powerful rotation: value outperformed growth, small caps outperformed large caps, and the equal-weight index began to lead. As shown, that outperformance remained intact for nearly 36 months before it failed.

The key distinction, then, is between rotation that signals deterioration and rotation that signals broadening. The former typically occurs alongside falling earnings estimates and rising unemployment claims. The latter occurs when the economy is resilient enough to support a wider set of winners. On this score, the fundamental backdrop remains constructive. Aggregate S&P 500 earnings estimates for the forward twelve months have continued to grind higher, not lower, which is a crucial differentiator from the pre-recession environments of 2000 and 2007, when estimates were rolling over well before the index peaked.

The labor market, while cooling from its post-pandemic tightness, has avoided the kind of abrupt deterioration that typically precedes a recession. Initial jobless claims, perhaps the single most reliable real-time indicator of labor market health, have remained contained.

Monetary policy also supports the bullish interpretation. The Federal Reserve’s pivot toward accommodation, whether through actual rate reductions or a clear willingness to ease if conditions warrant, provides an important backstop. Historical analysis from Ned Davis Research shows that when the Fed eases into an environment of positive earnings growth, the S&P 500 has posted gains in more than 80% of the subsequent 12-month periods. The combination of falling rates and rising earnings is, statistically, one of the most favorable macro regimes for equities.

The technical picture, while mixed, is not uniformly bearish either. The S&P 500 remains above its rising 52-week (1-year) and 208-week (4-year) moving averages. That 52-week moving average has been a consistent bullish “line in the sand” that, when lost and confirmed, has historically been one of the most reliable signals that a cyclical bear market is underway. As long as that trend anchor holds, the benefit of the doubt arguably belongs to the bulls. The most important trend line is the 208-week moving average. If that fails, the bears will have control of the market.

Moreover, sentiment indicators have swung sharply toward pessimism during the recent rotation, with the AAII bull-bear spread, the put-call ratio, and the CNN Fear and Greed Index all at levels that historically don’t suggest a market-topping process is underway. Market-topping processes are generally built on euphoria, not rising levels of uncertainty.

There is also a structural argument. The ongoing buildout of artificial intelligence infrastructure, the reshoring of manufacturing supply chains, and the capital expenditure cycle across the energy transition represent multi-year tailwinds for corporate earnings that extend well beyond the mega-cap technology cohort. If the AI investment cycle is broadening from the hyperscalers to the enterprise software layer and the industrial economy, then the rotation could have further to go.

So, which side do you pick?

The Verdict: Healthy Skepticism, Not Conviction

Markets rarely announce their intentions clearly, and the current environment is no exception. The bearish case rests on pattern recognition, the eerie similarity between today’s internal deterioration and the breadth collapses that preceded the last three major market topping processes, and on the arithmetic of valuation, which suggests that the margin of safety for equity investors is thinner than it has been in over two decades.

The bullish case rests on fundamentals that remain, for now, constructive: earnings are growing, the Fed is friendly, the labor market is intact, and sentiment is depressed enough to provide contrarian fuel. History shows that expensive markets with rising earnings can stay expensive far longer than value-oriented bears expect, and that defensive rotations within a secular uptrend are more often buying opportunities than exit signals.

The honest answer is that the market is at an inflection point where the evidence supports both interpretations. What will resolve the debate is not opinion, but price. As such, investors should pay close attention to key market levels, as noted in the Technical Update above.

• The 100-day moving average remains a key bullish trend support.

• The 200-day moving average is a critical support level for markets during a corrective process.

If the market breaks below the 100-day moving average, the market-topping process will likely be confirmed. If that happens, the next question for the bulls will be whether the S&P 500 can hold its 200-day average. The bulls, on the other hand, will need to see the market eventually confirm all-time highs on broader participation. A bull market can not last without the major sectors of Financials, Technology, and Healthcare providing support.

Key Catalysts Next Week

Traders face a packed week of macro data and heavyweight earnings beginning Monday, March 2nd. On the macro side, the week is bookended by two critical reads on the economy. ISM Manufacturing PMI lands Monday morning, after January’s surprise jump to 52.6 (the first expansion in 12 months), markets will scrutinize whether that rebound was genuine or simply a post-holiday reorder effect distorted by tariff front-running. A print below 50 would revive contraction fears and likely pressure cyclicals and small caps; a firm reading above 52 would reinforce the reflation narrative that has lifted Energy, Materials, and Industrials.

Wednesday is the ADP Employment Report and ISM Services PMI. Services never entered contraction, and ADP has shown a recovery in employment as of late. Then on Friday, the February Employment Situation (Nonfarm Payrolls) caps the week and will set the tone heading into mid-March. The key number will be the wage growth component; if average hourly earnings accelerate, it could push out rate-cut expectations and weigh on rate-sensitive sectors.

Earnings will also move the market next week: CrowdStrike (CRWD) reports after the close on Tuesday — the cybersecurity bellwether will offer a key read on enterprise security spend and the penetration of its Falcon Flex model. The market has priced in roughly a ±10% earnings move, so guidance will be the real catalyst. On Wednesday, Broadcom (AVGO) reports its fiscal Q1 2026 results with consensus revenue estimates near $19.2 billion.

Focus will be squarely on AI semiconductor revenue (guided to $8.2B for the quarter), custom ASIC demand from hyperscalers, and infrastructure software margins. Given the recent selloff in semis, a strong guide-up could reignite the AI trade. Thursday is Costco (COST) and Marvell Technology (MRVL), both reporting after the bell. Costco’s comparable sales trends and membership fee income will set the tone for the consumer, while Marvell’s data center revenue trajectory and Celestial AI integration update will add another data point to the AI infrastructure narrative.

Bottom line:

The bull trend is intact, but the “easy money” phase appears mature. The intermediate-to-long-term structure remains constructive. The 200-DMA is rising, breadth is near record levels, and the rotation trade is broadening participation. However, short-term momentum has deteriorated notably. The index is below both its 20- and 50-DMAs, the MACD has crossed bearishly, and the RSI is declining. Layer in the midterm election year seasonal headwinds, hotter-than-expected inflation, and Iran-related geopolitical risk, and the path of least resistance in early March tilts toward further consolidation or a modest pullback before the seasonal tailwinds attempt to reassert themselves. I suspect we will get a better entry point for a rally as we move into March. However, use that opportunity to rebalance oversized winners, define risk levels, and avoid chasing strength. Don’t fight the trend, but protect gains if volatility inevitably returns.

There is currently no evidence to suggest that the current rotation is the opening act of a more ominous distribution phase. However, that does not mean the evidence won’t eventually manifest. Therefore, investors who position dogmatically for a specific outcome are taking a lower-probability bet than those who remain flexible, watch the key levels, and let the tape itself provide the answer.

As the old market adage goes: the trend is your friend until it bends. The trend has not yet broken. But it is bending.

As questions hang over who will ultimately succeed Iran's slain supreme leader Ayatollah Ali Khamenei, an interim leader has been appointed to fulfill his duties. Top Shia cleric Alireza Arafi has been named to the interim Leadership Council after Supreme Leader Khamenei was confirmed killed in US-Israeli strikes, state media reported Sunday.

The ISNA news agency has described that Arafi, a member of the Guardian Council, is joining President Masoud Pezeshkian and Chief Justice Gholamhossein Mohseni Ejei on the body tasked with carrying out the supreme leader’s responsibilities until the Assembly of Experts appoints a permanent successor. All of this happening as US-Israeli bombs continue to fall on Tehran and other sites for a second straight day, 'uninterrupted' - as President Trump pledged Saturday.

Born in 1959, 67-year-old Alireza Arafi ranks among the most powerful clerics in Iran. Before his emergency elevation, he held three key posts: director of the nationwide Islamic Seminary system, member of the Guardian Council, and member of the Assembly of Experts.

While rooted in Qom's clerical establishment, Arafi combines traditional religious authority with seeking to carefully modernize Iran; however his appointment of course signals continuity, and he'll be tasked with seeking to ensure regime survival - which is what this moment is all about for Tehran. Most importantly, Arafi is viewed by the IRGC and political leadership as a loyal insider who will preserve a retaliatory trajectory during wartime.

Heavy US and Israeli bombing has been observed Sunday on the Iranian capital, particularly on known government and military command centers, but that hasn't stopped large gatherings of mourners in other parts of the country.

While there's been evidence of local celebrations in some sectors among anti-government Iranians, Sunday footage on state TV and other international media shows loyalists in possibly the hundreds of thousands showing solidarity with the slain Ayatollah the Islamic Republic leadership.

Mourners gathered at Tehran's Enghelab Square to honour Supreme Leader Ali Khamenei, who was killed on Saturday after the US and Israel launched massive strikes on the capital.

Iran's president branded the US-Israeli killing of Khamenei a "declaration of war against Muslims" pic.twitter.com/F7T8NDq1rg

— Middle East Eye (@MiddleEastEye) March 1, 2026

President Masoud Pezeshkian condemned the killing as "a great crime" and has declared seven days of public holidays in addition to the 40-day mourning period. Outraged and saddened Iranians were seen pouring into the streets of the capital soon after state TV finally made the announcement confirming Khamenei's killing during the opening salvo of the US-Israeli attack. Iranian authorities have alleged major war crimes, including the deaths of over 85 young girls attending school when a bomb struck.

"There will be expected ceremonies," Pezeshkian said, while noting they will have to happen even while the bombardment continues across the country. He's also said his country views revenge as its "legitimate right and duty" after Khamenei had been murdered by the "most wicked villains in the world."

The president further claimed the act was a "declaration of open war on Muslims, especially Shiites, in all corners of the world." According to NBC:

The government in Iran is under attack like never before. Today tens of thousands of regime supporters packed into Tehran’s Revolution Square to mourn the late Supreme Leader Ayatollah Ali Khamenei, who was killed in a joint U.S. and Israel military operation.

They chanted "God is great!" while officials promised revenge. One said Iran would deliver “terrifying blows” to make the U.S. and Israel beg for mercy.

Iran's interim leadership council: President Masoud Pezeshkian, member of the Guardian Council and Assembly of Experts Ayatollah Ali Arafi, Head of Judiciary Gholam-Hossein Mohseni-Ejei

As for the day to day running of the country and immediately overseeing the military response, Ali Larijani is believed to be in the driver's seat. Khamenei had reportedly personally tapped Larijani - a former Revolutionary Guards (IRGC) commander and political heavyweight - to take charge in the event of the Supreme Leader's death.

Israel has confirmed it has conducted new strikes "in the heart of Tehran" and that the "majority" or Iran’s senior military leaders - some 40 of them - were killed in the opening wave. "The Israeli Air Force continues to operate extensively in both defense and offense, with the goal of removing threats posed to the State of Israel," the IDF said - alongside the US boasting that they have established air superiority with much of Iran's radars and air defenses having been taken out already.

Iran has said that at least 200 of its people have been killed, but the actual figure could be much higher, and is expected to be in the coming days. The external attack could go on for weeks, given especially President Trump is now calling for full regime change, which would mean defeating and dismantling the Islamic Revolutionary Guard Corps (IRGC). The problem with this is that most analyst agree it would require boots on the ground. Trump says he wants to see full "freedom" in Iran as the goal of the military operation.

Trump's 'shock & awe': Tehran is a densely packed modern cosmopolitan city of almost 10 million people. The wider metropolitan area has over 16 million.

“This is a picture of Tehran. For you uneducated, untraveled, never-served, warhawks licking your chops at the thought of bombing it. It's not some low population desert. There are families, children, family pets. Regular working class people with dreams. You're sick to want war” pic.twitter.com/I60eoHpgON

— Mohamad Safa (@mhdksafa) February 28, 2026

Massive airstrikes on Tehran:

??Massive airstrikes on Tehran pic.twitter.com/kIB4OU3SDM

— War Monitor (@WarMonitors) March 1, 2026

So far, it's been limited to an air war, and with naval assets also firing, and no casualties on the US or Israeli sides have yet to be reported. It's mainly America's Gulf allies which have suffered, with Iranian ballistic missiles coming down on US bases in the region - but also strikes which have landed on hotels, buildings, and even major airports around the Gulf.

By all accounts Israel has been getting hit hard - though many analysts say Israel's military censor is working in overdrive, preventing an avalanche of information from getting out. However, there's still plenty of confirmation of some Iranian ballistic missile impacts:

??From site of Iranian missile impact in central Israel pic.twitter.com/nCrkWUOuP1

— War Monitor (@WarMonitors) March 1, 2026

Air alert sirens continue sounding especially across central Israel. Tel Aviv was struck overnight. Iranian state media meanwhile confirms:

IRAN FIRED FATTAH-2 HYPERSONIC MISSILES FOR FIRST TIME: FARS

This war looks to go on, even if there's desire in the White House for it to be 'one and done' - as increasingly the Iranians have nothing to lose. One likely result of the unprovoked US-Israeli attack is that leadership in Tehran will only become more hardline. We detailed some of the initial Saturday blowback on the Gulf allies - but Sunday has witnessed some direct repercussions on US embassies and diplomatic compounds in the region. 

The US Consulates General in Karachi and Lahore has come under attack by large angry mobs, within hours after Khamenei's death was announced. "Violent clashes between protesters and security forces in the Pakistani port city of Karachi left at least nine people killed and more than 50 others wounded on Sunday, after hundreds of demonstrators attempted to storm the U.S. Consulate, authorities said," according to AP.

Anger is boiling over in Pakistan, as protesters storm and burn the US consulate in Karachi. Pakistan is the home to the world's second largest Shia population in the world. The killing of Khamenei will have repercussions for the US. pic.twitter.com/lg9ch8mxp1

— Glenn Diesen (@Glenn_Diesen) March 1, 2026

Things are also popping off outside high-secured Baghdad's Green Zone, where Iraqis are trying to breach the US embassy, with hundreds seen rioting and even bringing bulldozing equipment to the site. The mob threw stones and clashed with Iraqi security forces, which responded with tear gas. "Their attempts had been thwarted so far, but they keep trying," an official told AFP. Iraq is a Shia majority country with heavy loyalty to the Shia religious establishment in Iran. Baghdad's general pro-Iran stance and influence is a legacy of the Bush Neocons, who overthrow Sunni secular Baath dictator Saddam Hussein and elevated the Shia Mullahs. 

Summary:

• UAE withdraws ambassador from Iran, closes embassy over attacks

• State media ISNA says Tehran’s Gandhi Hospital was attacked by US-Israeli bombs.

• Israel and US say over 40 of Iran's top officers killed in first wave of strikes.

• At least nine Israelis dead, over 40 injured in single Iranian missile impact...

• President Trump says Operation Epic Fury has sunk 9 'relatively large and important' Iranian naval ships, and that Iran's naval headquarters has been "largely destroyed." 

• The Pentagon confirmed three US service members stationed in Kuwait were killed and five seriously wounded in the opening phase of Trump’s Operation Epic Fury campaign against Iran. 

• Parts of Iran's national radio and television headquarters were hit in strikes, according to state media (Reuters) 

• US and Israeli airstrikes continue on Tehran targets

• Iran downed a US MQ-9 drone, reportedly hit a French base in Abu Dhabi

Update (1300ET): President Trump says that Operation Epic Fury has "destroyed and sunk 9 Iranian Naval Ships, some of them relatively large and important," and that "We are going after the rest" which will "soon be floating at the bottom of the sea." 

Trump also announced that a separate attack "largely destroyed their Naval Headquarters."

Meanwhile, two US officials told NBC News that the three US service members killed were part of an Army sustainment unit based in Kuwait. 

IRNA reports that Iran's State Broadcaster HQ in Tehran has been struck, according to Reuters.

*  *  *

Update: President Trump on Sunday said that Iran wants to talk and has agreed to do so, telling The Atlantic's (!) Michael Scherer "They want to talk, and I have agreed to talk, so I will be talking to them. They should have done it sooner. They should have given what was very practical and easy to do sooner. They waited too long." 

Asked about timing, Trump said "I can't tell you that," noting that some of the Iranians involved in negotiations in recent weeks are no longer alive. "Most of those people are gone. Some of the people we were dealing with are gone, because that was a big—that was a big hit," he said.

"They should have done it sooner, Michael. They could have made a deal. They should’ve done it sooner. They played too cute."

I asked Trump whether he was willing to prolong the U.S. bombing campaign against Iran to support a popular uprising if one unfolds. “Will they continue to get support if it takes some time to overthrow the regime?” I asked. Trump was noncommittal. “I have to look at the situation at the time it happens, Michael. You can't give an answer to that question,” he said.

But the president also expressed confidence that a successful uprising was coming, noting the signs of celebration in the streets of Iran and supportive gatherings of expatriate Iranians in New York and Los Angeles. “That is going to happen. You are seeing that, and I think it's gonna happen. A lot of people are extremely happy over there and in Los Angeles and in many other places,” he told me. (In addition to pro-regime-change celebrations in several major cities, large antiwar protests have also been held, many of them just a few blocks away.) -The Atlantic

tl;dr, Trump just gave his first substantial interview post-bombing to The Atlantic - which has spent a decade trying to destroy him, but now loves him, in which he now says he's willing to talk with whoever's left in Iran.

*  *  *

The Pentagon is confirming the first American troop deaths of the Trump-ordered 'Operation Epic Fury' toward accomplishing regime change in Iran:

U.S. military says three service members have been killed and five seriously wounded in the Iran operation: Associated Press

The president campaigned hard on starting no new wars in the Middle East, and abandoning Washington's "addiction to regime change"... but here we are once again. Below is the full statement issued by US Central Command:

President Trump, who has never served in the military, raised eyebrows with the following remark on Saturday:

“The lives of courageous American heroes may be lost, and we may have casualties, that often happens in war, but we’re doing this not for now; we’re doing this for the future.”

Some Congressional leaders are outraged that we are clearly in a war, and yet there's been no war authorization from Congress as required by the US Constitution.

On the question of 'legality' and Congressional oversight, Time notes as follows:

The White House said that the so-called Gang of Eight, the bipartisan group of top House and Senate leaders and intelligence committee chairs who are briefed on the nation’s most sensitive security matters, were notified by Secretary of State Marco Rubio shortly before the strikes began. Administration officials had also briefed congressional leadership and intelligence committee heads earlier in the week on escalating tensions with Iran. But those notifications fell short of formal authorization from Congress, which the Constitution assigns the power to declare war under Article 1.

While the Pentagon has not revealed specifics or the locations of the troop casualties, there's a likelihood it was the result of Iran's ongoing ballistic missile launches against US bases in the Gulf and Mideast region. Tehran has promised more to come, especially to avenge the death of Supreme Leader Khamenei. 

A look at the massive saturation strikes over the Iranian capital, as presented by the Israeli Air Force, with machine translation:

Below: Dozens of Air Force fighter jets completed another wave of strikes in the skies over Tehran, during which the General Headquarters of the Internal Security Forces was attacked—a facility that served as a command and control center responsible for linking the command echelon with the Iranian terror regime's forces in the field, and which also led the brutal suppression against the Iranian people.

????? ????? ??? ?? ???-?????? ?????? ?? ?????? ???? ???? ????, ??????? ????? ???? ????? ?? ????? ?????? ?????, ????? ????? ????? ??????, ?????? ???? ??? ???? ??????? ?????? ???? ????? ??????? ????, ??? ????? ?? ?????? ?????? ??? ??? ???????.
?????, ?????? ????? '?'??????' ??????… pic.twitter.com/oZAiFTdQbe

— Israeli Air Force (@IAFsite) March 1, 2026

There's also the possibility that US aviators may have been downed in these opening 48 hours of aerial attacks, given Tehran has already downed an MQ-9 Reaper drone, state media says. Likely there will be more American troop deaths to come, given the operation looks to be expanding, and could takes days, weeks, or even months or more.

Could the war go global as more and more countries and assets in the region are impacted?

The French base, Camp de la Paix in Abu Dhabi was reportedly struck. pic.twitter.com/Ogc237bpKs

— barry with the NED (@bonzerbarry) March 1, 2026

Glenn Greenwald has summarized, "For decades, Israeli Prime Minister Benjamin Netanyahu and American neoconservatives have dreamed of only one foreign policy goal: having the United States fight a regime-change war against Iran. With the Oval Office occupied by Donald Trump — who campaigned for a full decade on a vow to end regime-change wars and vanquish neoconservatism — their goal has finally been realized."

There's still hope for an offramp, however. On Sunday, Iranian Foreign Minister Abbas Araghchi told his Omani counterpart Badr Albusaidi in a call that Iran is open to "serious efforts" toward de-escalation and stability, according to Bloomberg. Albusaidi called for ceasefire and return to negotiation, urging Iran to exercise restraint and avoid moves that could undermine and disrupt good neighborly relations, particularly as Gulf countries are outraged.

Update (1045ET):

The United Kingdom Maritime Trade Operations reports three maritime incidents in or around the Strait of Hormuz involving commercial vessels.

First Incident

Second Incident

Third Incident

Reuters wrote on X, "Tanker owners, oil majors and trading houses suspended oil, fuel and LNG shipments through the Strait of Hormuz after Tehran said it had closed navigation." 

Tanker owners, oil majors and trading houses suspended oil, fuel and LNG shipments through the Strait of Hormuz after Tehran said it had closed navigation, raising fears of a major supply shock https://t.co/4UbLpzYyi1 pic.twitter.com/XxYYeFxH21

— Reuters (@Reuters) March 1, 2026

However, Bloomberg analyst Javier Blas cited Iran's Foreign Minister Abbas Araghchi in an interview with the media outlet Al Jazeera, stating that his country has no plans to close the Strait of Hormuz.

"Iran has no intention of closing the Strait of Hormuz at present, nor has any plans to do anything that would disrupt navigation in it at this stage," Araghchi said. 

BREAKING: Iran’s Foreign Minister Abbas Araghchi tells @AlJazeera his country has no plans to close the Strait of Hormuz.

“Iran has no intention of closing the Strait of Hormuz at present, nor has any plans to do anything that would disrupt navigation in it at this stage.”

— Javier Blas (@JavierBlas) March 1, 2026

Maritime news website Lloyd's List wrote on X that top container shipping carriers have "halted vessel transits through the Strait of Hormuz but there is speculation Chinese-owned vessels may be granted exemptions from the de facto blockade by Iranian authorities."

Leading container shipping carriers have halted vessel transits through the Strait of Hormuz but there is speculation Chinese-owned vessels may be granted exemptions from the de facto blockade by Iranian authorities pic.twitter.com/UCnuW6H4lw

— Lloyd's List (@LloydsList) March 1, 2026

Regardless, the critical waterway will be disrupted for the time being, as noted earlier.

*   *   * 

Oil and gas tanker traffic through the Strait of Hormuz, a critical maritime chokepoint, has seen disruptions as the U.S.-Israeli campaign, Operation Epic Fury, continues targeting Islamic Revolutionary Guard Corps command-and-control infrastructure across multiple Iranian cities; as of Sunday morning, only a limited number of tankers were observed exiting the Strait, while separate news reports indicate a sanctioned oil tanker was also attacked.

On Sunday morning, Automatic Identification System (AIS) vessel-tracking data showed that tanker traffic through the most critical energy chokepoint in the world, which handles about 20% of global petroleum liquids consumption and roughly 27% of global seaborne oil trade, had slowed to a near standstill, with tankers in holding patterns on both sides of the Strait's entrance and exit.

S&P Global Energy notes:

• Strait of Hormuz handles 20% of global oil supply

• Iran exported 1.3 mil b/d in Jan, mainly to China

FACTBOX: Oil markets braced as Iran confirms death of Supreme Leader Khamenei https://t.co/jAdG2emkVR

??Iran exported 1.3 mil b/d in Jan, mainly to China
??Strait of Hormuz handles 20% of global oil supply pic.twitter.com/T9m55W3Nq7

— Oil by S&P Global Energy (@SPGEnergyOil) March 1, 2026

The big development in the Strait this morning was the attack on a tanker.

All the evidence suggests that Iran attacked one of its own (very small) dark fleet oil tankers (which was under US Treasury sactions). It feels like a false flag operation. The tanker near Oman had been in the same area for ~10 days; she wasn't crossing the Strait of Hormuz. https://t.co/nLaiivp879

— Javier Blas (@JavierBlas) March 1, 2026

Oman's Maritime Security Centre revealed that the sanctioned tanker Skylight, flying the flag of the Republic of Palau, was targeted five nautical miles north of Khasab Port.

??Clearer vid pic.twitter.com/kLtv0xV6DE

— War Monitor (@WarMonitors) March 1, 2026

There are no confirmed reports identifying who struck the Skylight, but the incident came as Iran's semi-official Tasnim news agency said on Saturday that the Strait of Hormuz was effectively closed to vessel traffic.

Mohsen Rezaei, a member of the Expediency Discernment Council that advises Iran's supreme leader, warned on state TV that "no American ship is allowed to enter the Persian Gulf."  

German container liner Hapag-Lloyd AG has suspended all transits through the waterway due to its "official closure," while France's CMA CGM SA, the world's third-largest container line, told ships within its fleet to suspend passage through the Suez Canal and take shelter immediately.

The Financial Times reported that shipowners had canceled insurance policies and raised premiums for vessels transiting through the Gulf region.

We spoke with Rapidan Energy Group analyst Fernando Ferreira on Saturday about the situation unfolding in the Middle East, with a focus on the Strait.

Ferreira explained:

Iran understands that threatening traffic through Hormuz is its most credible asymmetric lever. Even limited interference can raise oil prices and impose immediate economic costs on the US and its partners, increasing pressure on Washington to de-escalate.

We expect at least moderate disruptions to Gulf oil flows in the coming days, with the risk tilted toward something more severe if tensions escalate further.

In energy markets, Goldman analyst Adam Crook told clients shortly after the operation began that:

Oil remains the most direct and liquid expression as a geopolitical hedge – while a full closure of the Strait of Hormuz remains a tail scenario, even a disruption of flows through the Strait via other means (targeting of ships, insurance issues) poses an upside scenario closer to $100/bbl. Additionally, whilst not our base case, an attack on Iranian Oil infrastructure puts 2mb/d of Iran Crude exports at risk.

A synthetic weekend market via IG has crude oil prices up as much as 9% early Sunday morning.

With flows through the Strait of Hormuz disrupted, the immediate impact will be higher Brent crude futures when markets open in New York this evening. The biggest pressure point, however, will be on China, which is the top buyer of Iranian seaborne crude and one of the most exposed major end markets for Hormuz-linked flows, meaning any prolonged disruption would further tighten Beijing's supplies.

This follows a squeeze on Beijing's access to cheap Venezuelan crude after President Trump moved last month to crimp those flows. All of this is unfolding ahead of President Trump's meeting in Beijing in about a month.