President Trump is reimposing the Strait of Hormuz blockade tomorrow at 4 p.m. ET, with a 20% fee on all cargo. Oil jumped 9.5% to $83 per barrel, the biggest daily spike since 2020.

Stocks didn't take it well. The Dow dropped 0.3%, the S&P 500 fell 0.8%, and the Nasdaq sank 1.6% as chip stocks led the decline and geopolitical fears returned. SK Hynix tanked 15.4% post-IPO, dragging Samsung down 10% and halting the Kospi. The AI trade, which has carried markets for months, suddenly looks vulnerable heading into earnings week.

CPI Tuesday, PPI Wednesday. JPMorgan, Goldman, BofA, and TSMC report. Intel commits €5 billion to Irish chip expansion.

Today:

📰 Hormuz blockade sends oil surging, chip stocks tumble, CPI/PPI this week
🤖 Apple sues OpenAI over trade secrets, PixVerse hits $2 billion
🚀 SK Hynix crashes post-IPO, Intel bets €5 billion on Ireland

Let's get started.

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Intel is doubling down on its European manufacturing footprint, committing €5 billion to expand its Leixlip campus near Dublin as the chipmaker fights to keep pace in the AI semiconductor arms race. The investment will upgrade Intel's Irish facility to produce advanced chips needed for AI workloads, a move designed to shore up the company's position against rivals like Nvidia and AMD who have dominated the AI chip conversation for the past two years.

The expansion comes at a critical moment for Intel. The company has spent the past year restructuring under CEO Pat Gelsinger's "IDM 2.0" strategy, which bets Intel can compete as both a chip designer and a foundry for other companies. Ireland has been central to Intel's European operations for decades, and this investment signals the company isn't backing away from its ambitious manufacturing buildout despite pressure on margins and a stock price that's lagged the broader semiconductor rally.

The broader context matters here. The EU Chips Act has poured billions into reshoring semiconductor production to Europe, and Intel has been a primary beneficiary. But money alone doesn't win chip wars! Intel still needs to prove it can manufacture at the cutting edge, something TSMC has done far more consistently. This Irish expansion is a test of whether Intel can translate capital into competitive chips, or whether it's just throwing money at a problem that requires execution.

Our take: The capital is real, and the EU policy tailwind is real. The execution risk is also real. If you believe Intel's foundry business can actually compete and that AI demand will require manufacturing diversity beyond TSMC, this expansion shows management is willing to fund the turnaround properly. But if you think TSMC's manufacturing lead is insurmountable and Nvidia's software moat makes process nodes irrelevant, this looks more like throwing billions at a structural problem that capital alone can't solve. Watch Intel's foundry wins in the next two quarters. That's where the strategy either proves itself or stalls.

US stocks fell Monday as semiconductor shares tumbled and fresh escalation between the US and Iran sent oil prices surging.

President Trump announced the US will reimpose its blockade of the Strait of Hormuz starting Tuesday at 4 p.m. ET, with US Central Command confirming it will enforce the blockade against vessels transiting to or from Iranian ports. The president also said the US would charge a 20% fee on all cargo shipped through the vital waterway, calling the US the "guardian of the Strait of Hormuz" and saying the country would be "reimbursed" for providing security. Brent crude jumped 9.5% to top $83 per barrel, its biggest single-day jump since May 2020, while WTI surged above $78. Voyages through the strait fell 52% week over week, according to intelligence firm Kpler.

SK Hynix tumbled 15.4% the (trading) day after its $26.5 billion Nasdaq debut. Samsung fell 10%, and trading for the Kospi index was actually halted after it fell 9%.

California is leading 12 states in a lawsuit to block the $110 billion Paramount-Warner Bros. merger, the largest proposed deal in Hollywood history. Attorney General Rob Bonta claims the merger would "extinguish" competition between two of Hollywood's five major film distributors, leading to higher prices and less content for consumers. Paramount defended the deal, arguing it would create "a stronger, well-capitalized, creative-first media company" better positioned to compete with Netflix. The lawsuit alleges the merger violates Section 7 of the Clayton Act.

Tariff refunds pushed the June federal budget deficit to $120 billion, a sharp reversal from the $27 billion surplus in June 2025. The Treasury reported gross customs collections of $23.6 billion but refunds of $49.2 billion, resulting in a net outflow of $25.6 billion for the month. The refunds stem from the Supreme Court's February ruling that struck down President Trump's broadest global tariffs as illegal under the International Emergency Economic Powers Act. June refunds more than doubled from the $22 billion returned in May.

Chip stocks led the decline as memory maker SK Hynix tumbled more than 9%, dragging the broader semiconductor sector lower. The sell-off revived concerns about volatility in the AI trade just as earnings season kicks off this week.

Two key inflation readings drop this week, with the Consumer Price Index on Tuesday and Producer Price Index on Wednesday. The data will provide fresh signals on whether the Fed hikes rates again this year. JPMorgan Chase, Goldman Sachs, Bank of America, and Taiwan Semiconductor all report earnings, giving investors a pulse check on both the banking sector and AI demand heading into the second half of 2026.

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Cheers,
Brandon & Blake of Invested Inc