Wednesday, 13 May 2026 · London Edition · 07:30 London

Iran war's supply shock is being priced commodity by commodity.

Join Tom, Gerald and Marie for this edition's podcast · 12 min

Signals

⚡ Convergence radar: Buy NVDA×3

India tariffs

India more than doubled gold and silver import tariffs to defend the rupee after PM Modi warned the Middle East crisis is pressuring forex reserves. Bloomberg and WSJ confirm the move, with the rupee weakening further in NDFs. The tariff is a defensive band-aid that may temporarily curb metal imports but does nothing for underlying capital outflows. INDA is already down 1.9% on the day — the stress is in the price, but not exhausted.

GLD

Sell Gold ETF — India's import tariff hike may reduce gold demand, but the global price impact is limited; GLD is -0.4% today and still 15% below its 52-week high.

$432.9 -0.40%
SLV

Sell Silver ETF — Silver demand faces the same tariff headwind as gold, though SLV is +0.7% on the day on broader commodity strength.

$78.55 +0.71%
INDA

Sell India ETF — Defensive tariff measures signal currency stress and capital outflows; INDA is -1.9% today and -12.9% YTD, with no sign of the pressure abating.

$47.52 -1.86%
USDINR=X

Sell USD/INR — Tariffs aim to support the rupee, but underlying vulnerabilities suggest limited and short-lived strength.

Nvidia CEO

Nvidia CEO Jensen Huang joined Trump's China trip after being absent from the initial delegation, with Nikkei Asia and CNBC reporting he flew to Alaska to board Air Force One following a personal call from the President. The reversal eases market anxiety over chip export controls and signals potential for diplomatic progress. NVDA is just 1% off its 52-week high at $220.8.

NVDA

Buy Nvidia⚡ — Huang's inclusion may indicate progress on chip export controls, lowering regulatory risk; NVDA is +0.6% today and +16.9% YTD.

$220.8 +0.61%

Indonesia equities

MSCI removed 18 Indonesian stocks from its global indexes due to concentrated ownership, FT and Bloomberg report. Names like Barito Renewables and Chandra Asri fell sharply. The index rebalancing will force passive fund selling and raises governance red flags. EIDO is -0.6% today and down -22.7% YTD, just 1% above its 52-week low.

EIDO

Sell Indonesia ETF — MSCI removal of key constituents will trigger forced selling and shrink ETF weight; EIDO is hugging a 52-week low.

$14.54 -0.62%

Copper

Copper extended gains above $14,000/ton, inching toward the 2026 record high as global mine disruptions tighten supply. Bloomberg reports mounting supply risks. Copper miners and the commodity tracker are rallying: FCX +2.6%, SCCO +3.5%, CPER +2.7% on the day. CPER is at the very top of its 52-week range (0% below high) — the trade is crowded but the supply thesis is intact.

CPER

Buy Copper ETF — Supply tightening supports prices, but CPER sits at its 52-week high, making new entries risky.

$40.44 +2.67%
FCX

Buy Freeport-McMoRan — Major copper producer benefits from higher prices; FCX is +2.6% today and +27.2% YTD.

$66.03 +2.58%
SCCO

Buy Southern Copper — Pure-play copper miner rallies on the price move; SCCO is +3.5% today and +30.1% YTD, near its 52-week high.

$191.8 +3.52%

Memory shortage

The memory chip shortage is deepening due to the AI buildout, widening the gap between winners and losers, Bloomberg reports. Micron is the direct beneficiary: MU +15% in a week as tight supply drives pricing power. Nvidia also benefits as AI demand fuels memory needs. MU at $766.6 is still up 143% YTD with a low forward P/E of 7.5 — the shortage story still has legs.

MU

Buy Micron — Memory shortage boosts pricing power; MU +15% in a week and cheap at 7.5x forward P/E despite a 143% YTD run.

$766.6 -3.61%
NVDA

Buy Nvidia⚡ — AI chip demand intensifies memory demand, reinforcing Nvidia's revenue growth; NVDA at $220.8 trades near its 52-week high.

$220.8 +0.61%
SMH

Buy Semiconductor ETF — Sector benefits from AI-driven memory demand; SMH +50.3% YTD and 3% off its 52-week high, reflecting momentum.

$561.3 -2.61%

Energy stocks

WSJ's Jinjoo Lee argues energy stocks remain attractively valued despite the oil crisis. XLE trades at 20.9x trailing P/E, well below the sector's 5-year average, while USO sits just 5% below its 52-week high at $144.3. The call is a direct contrarian play: buy the lagging stock proxy, not the euphoric commodity.

XLE

Buy Energy Select ETF — WSJ's explicit call to buy cheap energy stocks; XLE +26.1% YTD and 9% below its 52-week high, with oil tailwinds still building.

“Energy stocks are cheap and offer attractive bargains despite the oil crisis.”

$57.57 +0.70%
USO

Buy Oil Fund — Oil crisis perpetuates elevated prices; USO +109.3% YTD at $144.3, near the top of its range but still supporting energy stocks.

$144.3 +4.07%

Hormuz construction

FT reports the Hormuz closure has stalled construction projects worldwide as oil-derived material costs soar. The disruption is a direct positive for oil (USO) and, via import substitution, for domestic steel like Cleveland-Cliffs (CLF), but a clear negative for homebuilders (XHB). CLF is down 4% today and -20.7% YTD, while XHB is -1.6% and -5.5% over the past week.

USO

Buy Oil Fund — Hormuz closure tightens oil supply; USO has already priced much of this, up 7.7% in a week.

$144.3 +4.07%
CLF

Buy Cleveland-Cliffs — Higher import costs could shift demand to domestic steel; CLF -20.7% YTD and cheap at 1.06x P/B, offering value if the trend holds.

$10.79 -4.00%
XHB

Sell Homebuilders ETF — Soaring construction costs and project delays hurt homebuilders; XHB -5.5% in a week and 19% below its 52-week high.

$99.97 -1.59%

US LNG exports

Europe's reliance on US natural gas is expected to hit a record in 2026 as the Iran war disrupts Middle East supplies, per IEEFA cited by Bloomberg. This benefits US gas prices (UNG) and LNG exporters like Cheniere (LNG). UNG is -9.5% YTD but +4.4% in the past week; LNG +23.5% YTD but -6.5% in a week — the trade is not yet crowded.

UNG

Buy Natural Gas Fund — Record EU demand supports US gas prices; UNG +4.4% in a week, offering an early-cycle entry.

$10.91 -2.76%
LNG

Buy Cheniere Energy — Top US LNG exporter benefits directly; LNG trades at 12.7x forward P/E and is -6.5% in a week, providing a better entry.

$244.3 +1.50%

Fertilizer

Bloomberg reports the Gulf shipping standoff from the Iran war is disrupting fertilizer supply, hitting vulnerable farmers like those in Malawi. CF Industries, a major nitrogen producer, stands to gain from higher fertilizer prices. CF is +4.75% today and +62.7% YTD, while MOO, the agribusiness ETF, is flat on the day but could benefit from rising crop prices.

CF

Buy CF Industries — Fertilizer supply disruption pushes prices higher; CF +62.7% YTD and trades at 11.7x trailing P/E, still reasonably valued.

$130.4 +4.75%
MOO

Buy Agribusiness ETF — Rising crop prices from supply shocks benefit agribusiness; MOO +12.1% YTD, a measured play.

$82.63 +0.88%

GameStop M&A

CoinDesk and WSJ report eBay rejected GameStop's $56bn half-cash, half-stock bid, calling it 'neither credible nor attractive.' The failed bid highlights GameStop's aggressive M&A strategy and its bitcoin exposure. GME -3.45% today and -11.1% in a week; EBAY +2.1% on the day, near its 52-week high.

EBAY

Hold eBay — Rejection supports independence, but no immediate catalyst; EBAY +2.1% today and just 1% off its 52-week high.

$110.4 +2.10%
GME

Sell GameStop — Rejected bid and overreach risk pressure the stock; GME -11.1% in a week and deep in the red over 1Y.

$22.37 -3.45%

Yuan divergence

Morgan Stanley sees the yuan's rally slowing, diverging from the consensus that it's significantly undervalued, Bloomberg's Jacob Gu reports. If Chinese currency appreciation stalls, the tailwind for Chinese equities fades. FXI is flat on the day and -6.3% YTD; the trade isn't crowded, but direction depends on the yuan's next move.

FXI

Watch China Large-Cap ETF — Morgan Stanley's more cautious yuan view could remove a key equity tailwind; FXI -6.3% YTD with the currency signal unresolved.

$37.33 -0.37%

Most original take

Jinjoo Lee · WSJ Business · 12 May 2026

Despite the War, Energy Stocks Are Cheap

WSJ's Jinjoo Lee argues that despite the Iran war and oil crisis, energy stocks are cheap on a historical basis and offer compelling value. Investors remain skeptical, but current multiples and the persistent commodity backdrop create asymmetric upside for the sector. The call fades the popular trade of buying the commodity directly and advocates for out-of-favor equity exposure.

Read original ↗

Our view

Today's signals collectively paint a picture of a global supply chain stretched thin by the Iran war. Copper flirts with all-time highs, construction materials soar, and even potato-chip bags go monochrome. India's emergency tariff hike on gold and silver is the clearest distress signal — a major economy weaponizing import taxes to protect forex reserves. The market is pricing each commodity disruption individually, but the aggregate message is one of cascading shortages.

The case against chasing this: positioning in oil and copper is stretched. USO is just 5% off its 52-week high at $144.3, and CPER sits at the very top of its range with no headroom — these are not early-cycle plays; they're momentum trades that rely on the crisis persisting. Any credible move toward a ceasefire — and there is zero press chatter about one today — would trigger violent mean reversion in the crowded long-commodity trade. Tread carefully.

Notably absent from today’s coverage: any discussion of central bank coordination. Commodity price spikes are feeding into inflation expectations, yet there’s no Fed speak, no ECB emergency signaling. If WTI stays above $130, the rate-cut narrative for H2 evaporates. This isn't in the press yet, but it’s the macro underbelly no one wants to touch.

The cleanest expression: rotate from commodity momentum into cheap energy equities. XLE at 20.9x trailing with oil at crisis levels offers value the futures curve doesn't. The stocks have lagged the commodity — that’s the gap to close.

Yesterday's signals, today

From the London Edition on 12 May 2026 — 4/4 signals moved in the predicted direction.

Today's scan: 290 articles considered · 16 surfaced · across 13 publishers

Generated Wed 13 May 2026 7:10am London · 1,212 views

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Methodology