Why Markets Moved

1. Strait of Hormuz blockade reinstated — oil surges, risk-off rotation triggers.

The Trump administration announced the reinstatement of a naval blockade on Iranian shipping through the Strait of Hormuz, the chokepoint for roughly 20% of global oil transit (Guardian, 12:36 ET). Crude oil spiked intraday, with WTI settling at $78.14 — the largest single-day gain since April 29 (ForexLive, ~16:30 ET). Energy stocks rallied while the broader market pivoted to risk-off, with tech and chip names bearing the brunt.

2. Semiconductor selloff — SK Hynix -15%, Philly Semi Index -2%+.

SK Hynix tumbled 15% in South Korean trading, triggering a cascading selloff in global chip stocks (Motley Fool, 13:28 ET). Micron, Nvidia, and AMD all traded lower. The Philadelphia Semiconductor Index fell more than 2% intraday. The selloff reflected fears that Middle East instability could disrupt Asian semiconductor supply chains. SK Hynix ADRs also began trading under a new ticker Monday, adding to the volatility (Morningstar, 13:19 ET).

3. Energy sector cushions the Dow — classic rotation, not liquidation.

The S&P 500 energy sector was the only major group in positive territory, with Exxon Mobil and Chevron leading gains (Globe and Mail, 12:38 ET). The Dow outperformed the Nasdaq as energy and defensive sectors provided offsetting support against tech weakness. The rotation was orderly — breadth was negative but not panicked.

4. Crypto slides on inflation fears and risk-off spillover.

Bitcoin and Ethereum both declined, reversing some of last week's gains, as the crypto market tracked the tech selloff (Motley Fool, 14:30 ET). Traders cited concern that elevated oil prices from the Hormuz blockade could feed into inflation expectations and reduce the odds of near-term Fed rate cuts.

Equity Market Internals and Notable Movers

Sector divergence: Energy was the sole bright spot, rallying on crude's surge. Technology and consumer discretionary led the downside, with semiconductors the weakest sub-sector. Financials were mixed, and utilities and healthcare provided defensive ballast.

Notable single-stock moves:

• SK Hynix: -15% in Seoul; US ADRs under pressure (Motley Fool, Barron's)
• Micron (MU): slid in sympathy with SK Hynix as memory-chip peers (StockStory, 13:54 ET)
• Sandisk (SNDK): lower amid the semiconductor rout (Barron's, 16:16 ET)
• Apple (AAPL), Meta (META): declined with broader tech but moves were muted (Barron's)
• Exxon Mobil (XOM), Chevron (CVX): rallied on crude's surge (Globe and Mail)
• Volkswagen: confirmed plan to cut 50,000 jobs as board rejected plant closures (Guardian, 09:42 ET)

Breadth: Negative but orderly. The decline was concentrated in tech and chip names; defensive and energy sectors provided offset. No signs of a broad liquidation event.

Rates, FX, and Commodities

Treasuries: Yields edged fractionally higher across the curve. The 10-year T-note future (TY1) settled at 108.64, down 0.06% on the session (market_snapshot.json, 16:59 ET). The 2-year (TU1) was essentially flat at 102.80. The modest curve move suggested the bond market viewed the Hormuz escalation as an oil-supply event rather than a systemic financial shock.

Crude oil: WTI (CL1) settled at $78.00, down 0.18% versus prior settle — reflecting the session's late fade after the intraday spike on the Hormuz blockade announcement (market_snapshot.json, 16:59 ET). The intraday high was significantly above the settle, with the initial blockade headline sending crude sharply higher before profit-taking set in. Natural gas (NG1) was up 0.17% to $2.90.

Gold: GC1 settled at $4,008.70, up a marginal 0.07%, failing to attract meaningful safe-haven flows despite the geopolitical escalation — consistent with an oil-supply shock rather than a broader flight to safety.

Crypto: Bitcoin and Ethereum declined, tracking the tech risk-off move. The correlation with the Nasdaq remained elevated (Motley Fool, 14:30 ET).

FX: The dollar was modestly firmer, consistent with risk-off positioning.

Earnings and Corporate Developments

Earnings season preview: Q2 earnings season kicks off this week with major bank reports: Goldman Sachs, JPMorgan Chase, and Morgan Stanley. Netflix and Tesla report later in the week (CNBC, Jul 10). The Hormuz geopolitical overhang adds an unpredictable variable to what was expected to be a fundamentally-driven earnings week.

VW restructuring: Volkswagen's CEO confirmed plans to cut 50,000 jobs, though the board rejected plant closures (Guardian, 09:42 ET). The restructuring signals ongoing cost pressures in European automotive manufacturing.

Leifheit / Vossloh: European industrial companies adjusted guidance: Leifheit approved a FOCUS performance program and Vossloh adjusted its sales and earnings guidance for fiscal 2026 (Business Insider, 13:08-13:20 ET).

No major US earnings after the close reported as of the 6 PM ET cutoff.

Tomorrow Setup

Economic calendar (Tuesday, July 14):

• NFIB Small Business Optimism (06:00 ET): a read on Main Street sentiment
• Fed-speak watch: no scheduled appearances, but any Fed official comments on the Hormuz situation and its inflation implications would move markets
• Treasury auctions: continued supply this week; Monday's 3-year and 10-year auction results will be digested

Key levels:

• S&P 500 futures (ES1): support at 7,547 (session low), resistance at 7,615 (session high)
• Nasdaq 100 futures (NQ1): support at 29,386 (session low), resistance at 30,041 (session high)
• WTI crude (CL1): $78 settle; the Hormuz risk premium could push crude toward $80+ if tensions escalate. Support at $76.

Bull case: Hormuz tensions de-escalate, chip stocks bounce on oversold conditions, bank earnings beat — S&P 500 retakes 7,600.

Base case: Geopolitical uncertainty persists but is contained; markets trade sideways with a defensive tilt ahead of Wednesday's CPI. Energy and defense stocks remain bid; tech consolidates.

Bear case: Hormuz situation escalates into direct military engagement, crude spikes above $85, inflation fears surge, and chip supply-chain disruption fears trigger a broader tech liquidation.

Biggest risk to base case: The Hormuz blockade is a binary geopolitical event — a single incident in the Strait could turn a rotational selloff into a broad risk-off event overnight.