Iran now issues passage permits for the Strait of Hormuz, sixty one commercial ships have been attacked since March, and crude is lower this morning.
Good morning and welcome to today's market chronicle. It's Wednesday, August 12, 2026.
Yesterday was the kind of session Wall Street files under consolidation, because "we sold a bit and would rather not discuss it" does not fit in a headline. The S&P 500 slipped 0.32% to 7,728.20, the Dow gave back 184 points to 53,791.85, the Nasdaq lost 0.60% to 26,445.45, a second polite step away from last week's record. The named culprit was Alphabet ($GOOGL), off 3.6% after the 2026 capital expenditure guide was raised to as much as $205 billion, quarterly capex doubled year over year to $44.9 billion, free cash flow turned negative for the first time, and the company placed $25 billion of senior notes maturing out to 2066. Translation: the most profitable advertising machine ever built is borrowing against the year 2066 to buy accelerators, and le tout-Wall Street decided this was worth exactly one bad afternoon. Who actually won there? The bondholders, probably. Meanwhile the story with dead seafarers in it stayed in the commodity pits, where crude swings daily on whether Tehran feels like letting the world's oil corridor function. Sixty one ships hit since March, seventeen sailors killed, a reimposed American naval blockade, the Houthis now firing on Saudi tankers in the Red Sea, and oil is lower on the day. Everyone pretends not to notice.
Ahead of us, July CPI at 8:30, headline expected to cool to 3.4% from 3.5%, core around 0.1% on the month. Note what is actually being argued about: not the size of the September cut, but whether Kevin Warsh raises rates. Payrolls fell by 23,000 in July and the market still gives a hike better than one chance in three, with nine of eighteen participants penciling one for this year. The wise men of the committee have decided the cockroach in the basement is inflation and not employment. Then Cisco ($CSCO) after the close, with Coherent ($COHR) and the rest of the picks and shovels crowd, one of 189 reports today that nobody will read past the capex line.
On our own book, we closed Palo Alto Networks ($PANW) yesterday, up 10.58% against 1.70% for the S&P 500 over the same six sessions. The position was sized for two quarters and reached our price in days. Nothing in the thesis broke, the payoff simply arrived ahead of schedule. A target reached early is still a target reached, which is a compliment to the rule and not to anyone holding it.
The tape as it stands: gold at $4,405.93, up 0.8%; WTI at $82.87 and Brent at $88.63, both slightly lower; Bitcoin around $63,773, still doing its impression of a risk asset that has run out of things to say; the 10-year at 4.68%, easing a second session into the print; S&P futures up 0.2% before the bell.
Two hours from now a single number decides whether the hawks get their September. Nothing else today matters, which of course means everything else will move anyway.
Have a good one, and see you tomorrow.