Morning markets slipped as Brent crude climbed to $115 after a brief exchange of low‑intensity fire between the US and Iran, underscoring the fragile status quo in geopolitical tensions. Palantir, a defence‑tech favorite, beat earnings estimates but saw shares dip, reflecting investors’ cautious stance.

U.S. equities now trade on tighter price‑to‑earnings multiples, a shift from the decade‑long reliance on hype. Analysts note that rising earnings expectations are aggressive, yet risk persists, especially if the AI‑driven optimism overlooks potential downside.

Bank of Singapore’s Mansoor Mohi‑uddin likens the current rally to early 2000s optimism, while Bank of America labels the phase a “boom loop” where policymakers chase maximum employment and asset prices. Should asset‑price gains spill into real‑world inflation, policy makers may face a sudden recalibration.

The confluence of geopolitical uncertainty and inflated earnings expectations paints a complex picture: investors enjoy low multiples today, but the next shock could quickly erode gains. The market’s patience is finite, and any misstep could trigger a swift correction.