Iran war pumps commodities, inflation; tech cracks into correction.

Transcript

Tom Alright, buddy — if yesterday was about SpaceX fear, today it’s all about what happens when Iran stares down the Strait of Hormuz. Commodities on fire, tech in a correction, and inflation? Yeah, that’s back too. Let’s dig in.

Marie Good morning, it’s Thursday, June 11th, the London edition of Investment Flash. I’m Marie, and with me — Tom and Gerald. We’ve got a packed show: oil’s spiking, bonds are crumbling, and the XLK just notched a 6.4 percent weekly drop. Plus, an anti-Nvidia startup that just raised a billion and a half. Let’s get to it.

Tom Marie, can we just — can we start with oil? Because the Shell CEO literally came out and said prices stay elevated even if the war ends. That’s a huge statement.

Gerald Yeah look, the FT and Journal both ran it — USO up another two point three percent last session, year to date up ninety. But Tom, it’s still thirteen percent below its fifty-two-week high. The market’s already pricing a lot of this.

Tom That’s exactly the opportunity, Gerald! If the CEO of Shell says the supply fear isn’t going away, then the pullback from intra-month highs is just noise. I’m buying USO.

Marie Hold on — but what about the inflation print? Four point two percent C P I, Tom. That’s not noise. The energy shock is bleeding straight into core. And if the Fed can’t cut, how much higher can oil really go without killing demand?

Gerald Exactly. TLT is three percent from its fifty-two-week low. Bond market’s screaming higher-for-longer. That’s a headwind for any commodity that’s purely speculative.

Tom Okay, fair — but then you have to like the energy sector, right? XLE was up one and a half percent last session, year to date twenty-six. It’s a straight pass-through to elevated crude. No bond market kills that.

Marie Sure, but then you’re long the exact thing that’s driving inflation, and the Fed is watching. I’m not saying it’s wrong — I’m saying the pair trade is more interesting. Long XLE, short TLT. That’s the real bet that war and inflation keep real yields pinned.

Gerald I’ll give you that. And look, copper and aluminium — I mean, FT called it a super-squeeze, and the Iran disruption just tightens it further. CPER down two point three percent last session but that’s a dip to buy, honestly.

Tom Yes! And the base metals basket, DBB, same story. Supply isn’t coming back fast. I’d rather be in commodities than tech right now.

Marie Speaking of tech — Tom, yesterday we said sell technology sector ETF, and the XLK is down six point four percent this week. That call is already working.

Tom Ha, I know — and it hurts me to say it, because you know I love tech. But Micron down four point seven percent, Intel dragging — this correction has legs. And with Oracle earnings tonight, it’s a binary event.

Gerald Let’s talk Micron. Forward price to earnings of eight looks cheap, but it’s a classic peak-cycle value trap. Memory prices roll over, and suddenly that eight becomes twenty. I’m not buying the dip.

Marie Right, and Intel — seventy times forward earnings for a turnaround story that’s been turning for three years? No thanks. The tech correction is overdue.

Tom But that’s where Oracle comes in — if they beat on cloud infrastructure, it could reignite the whole AI trade. The stock’s down forty-two percent from its high. Bad news is priced in.

Gerald Or they miss, and we drop another five percent. I mean, Tom, you remember when you said semis were cooked in Q2? And then Nvidia rallied forty percent? This time might be different, but calling a bottom on a name down twelve point nine percent this week alone is bold.

Tom Ha — fair enough, Gerald. But you know what’s not bold? The trucking recovery. JB Hunt up forty-five percent year to date, freight rates finally turning. That’s a real cyclical signal.

Gerald Oh, come on — thirty point six times forward earnings for a trucker? That’s more than some SaaS companies. The easy money is gone. I’ll pass.

Marie Yeah, but the transports ETF, IYT, is riding this too — up fourteen percent year to date. If freight rates are inflecting, you don’t need to buy the exact top ticker. Go broad.

Tom Exactly! And speaking of broad, the utilities merger — Duke buying Dominion, the Journal says it’s a straight buy. Defensive, data-center exposure, mergers and acquisitions kicker. That’s a Gerald stock if I ever saw one.

Gerald Alright, alright — I’ll take that. Duke and Dominion, sixteen to eighteen times forward, decent yields. I’m in. But Tom, if you’re chasing momentum in trucking at thirty times, I’m not bailing you out.

Marie Okay, but let’s pivot to the debanking probe — because this is exactly my lane. JPMorgan and Bank of America subpoenaed by Jeanine Pirro’s office. That’s a new regulatory risk at a time when net interest margins are shrinking. I’d be selling JPMorgan and Bank of America.

Tom Yeah, JPMorgan already down three point nine percent year to date. This probe could drag on. And regional banks — KRE up nine point two percent year to date — are they next?

Gerald To be fair, the debanking narrative is politically charged. It might blow over. But for now, it’s a headwind. I’d rather look at European banks — UniCredit raised its Commerzbank stake to thirty-seven point seven percent. That deal is happening.

Marie Wait — Gerald, that’s your Europe angle. But Commerzbank is at a forward price to earnings of nine point six. Even with a two percent dip last session, that’s cheap. And a full takeover would unlock serious cost synergies.

Gerald Exactly. And UniCredit is down four point seven percent on the week, but that’s integration risk. I’d hold it — but the real play is buying Commerzbank ahead of the offer deadline.

Tom Alright, Gerald, I’m with you on that. But can we talk about the anti-Nvidia startup? TensorWave, backed by AMD, valued at one point five five billion — they’re filling data centers with AMD chips. This is a direct shot at Nvidia’s monopoly.

Gerald Yeah, the WSJ called it the most original take of the day. And I’ll say this: AMD down four point nine percent last session, seventeen percent below its high — that’s an oversold opportunity if this startup proves AMD is viable for AI workloads.

Marie But let’s not get carried away — one startup doesn’t break Nvidia’s lock. The software ecosystem is still CUDA. Still, if I’m hedging my tech exposure, I’d rather buy AMD on this news than short Nvidia outright.

Tom Fair. And you know what else is interesting? Ares Management — raised eight point five billion for a new fund, into data centers, railcars, music royalties. Stock’s down twenty-one point five percent year to date, thirty-four percent below its high. That’s deep value.

Gerald Ares trades at seventeen point five forward. If they can keep raising billions in a tough private market, that’s a buy. The market’s treating it like a melting ice cube, but the inflows say otherwise.

Marie And then there’s the bitcoin ETFs. BlackRock and Fidelity are turning it into a two-firm market. IBIT and FBTC down thirty-one percent year to date. If you believe in long-term institutional adoption, this is the entry.

Tom Buddy, I’m not touching bitcoin until we see some regulatory clarity. But yeah, if you’re a believer, those two are the clear winners.

Gerald Look, the convergence today is clear: Iran drives commodities, inflation drives bonds down, and tech gets crushed. The question is whether tonight’s Oracle print changes anything.

Marie Our view is it’s a classic late-cycle stagflation tilt. But the counterargument — and here’s where I think we need to be careful — is crowding. TLT is heavily shorted, gold just dropped four percent on profit-taking, and oil is off its highs. If Oracle beats, the tech correction could snap back and the commodity trade loses its narrative.

Tom Exactly — and no one’s talking about the consumer. Four point two percent C P I means real wages are compressing. If that continues, discretionary spending cracks. That’s the next story, and it’s invisible today.

Gerald Right — so the cleanest second-order play is the pair: long XLE or CPER, short TLT. Bet that the war-inflation nexus keeps real yields under pressure. Or buy puts on XLK ahead of Oracle if you’re hedging a deeper tech washout.

Marie Totally.

Tom One hundred percent.

Gerald That’s the whole story.

Marie As always, none of this is investment advice. Just our take on the signals.

Tom And if you’re just finding us, hit follow on Spotify — or check investmentflash.com for the full digest with charts and sources. We’re back at nine a.m. New York time. See you then, buddy.

Gerald Yep, later today, nine a.m. New York. Cheers.