President Trump threatened to block the Strait of Hormuz after US‑Iran talks collapsed in Pakistan, aiming to stop Iran from levying tolls on transiting tankers. Futures spiked, pushing crude higher while equity futures slipped, signaling a risk‑off tone in early trade. The move also raises geopolitical risk premiums for shipping insurers.

The Federal Reserve is urged to look through the surge in energy prices, but most investors cannot. Recent CPI, PCE and revised Q4 GDP data sharpened concerns that inflation remains sticky and growth modest. Meanwhile, the labor market shows resilience, keeping the Fed’s hawk stance intact. With corporate earnings still strong, analysts warn that any premature rate cuts could trigger a job‑loss spike that would scar equities.

Man Group’s Adam Singleton warned that chasing oil‑driven rallies fuels both TACO and FOMO, leaving portfolios exposed. AQR researchers dismiss crypto, private credit and buffer funds as true hedges, noting Bitcoin’s equity beta of 2 and the high stock correlation of private‑credit assets. Consequently, many fund managers are revisiting multi‑asset strategies that blend real assets with selective credit exposure.