Daily Brief — November 04, 2026
Iran's Revolutionary Guards said naval mines destroyed four tankers and left them ablaze south of the Strait of Hormuz, with two more vessels detained, as the US military held plans to resume major combat operations against Iran as early as November 4.
Four tankers burning on mines south of Hormuz, with US plans to resume major combat operations dated today, have split Washington's diplomatic track from its physical one. The war premium being unwound in physical crude now rests on a de-escalation that is no longer the dominant signal.
Geopolitics
Iran / Hormuz — The Revolutionary Guards said four tankers were destroyed and left ablaze after striking mines south of the Strait of Hormuz, with two more detained, while Trump told the FT there was "no immediate plan" to strike Iran. US planners have nonetheless prepared to resume major combat operations as early as November 4 using the three carriers in the region, and mediators flew back to Tehran the same day.
Israel / Gaza — Trump said the US will stop $4 billion a year in military aid to Israel at the end of the year, saying the country "no longer needed it," under a deal he struck with Netanyahu that still allows US weapons sales. The cutoff is pinned personally to Netanyahu and framed as an electoral liability, and Eisenkot's refusal to join the US-backed unity government leaves it without its central figure.
Global Conflicts — Houthi forces launched cross-border ground raids into Saudi territory, and a Houthi spokesperson claimed a ballistic missile strike on Riyadh's Khalid Airport while a Yemeni military source warned Saudi Aramco facilities are within range. Turkey's parliament is set to ratify a defence pact with Saudi Arabia and Pakistan as the attacks mount.
Macroeconomics
ECB / European Monetary Policy — Euro-area inflation quickened to 4%, double the ECB's target, and Nagel said the bank will probably raise borrowing costs next month on the worsening outlook, with Kazaks and Knot pointing to further increases. The split is over pace, not direction: the ECB wage tracker fell to 2.408% for Q2 2027 and Sleijpen said second-round effects are not yet visible.
USD / FX / Currencies — The dollar fell the most in a month as early results pointed to a Democratic sweep, with the euro up 0.5% to $1.125 and USD/CHF down 0.86%. The PBOC raised its FX reserve requirement ratio for the first time in five years to brake the yuan's rally, while gold rose 3% to $4,035.85 and silver nearly 5% to $52.26.
Markets
US Indices — Nasdaq 100 futures fell as much as 2% overnight as Democratic-sweep odds hit 95%, erasing $500 billion in two hours — then the selloff was bought, with the S&P 500 up 1.47% at 7,696 as Big Tech added $750 billion. Goldman notes 60% of constituents remain in bear-market territory with the index about 3% from a record, so the recovery is narrow rather than broad.
AI Chips / Semiconductors — AMD guided fourth-quarter revenue to about $17 billion — roughly 65% above the $10.3 billion posted in Q4 2025 — after data-centre revenue rose 97% to $8.55 billion and beat on both lines. Nvidia rose 3% to retake the most-valuable-company title at a $5 trillion cap, even as US officials held up approval for the chipmaking equipment SK Hynix needs to expand in China.
AI
China AI Labs — Moonshot AI published Kimi K3.1 Pro's weights on Hugging Face, a 2.8-trillion-parameter model whose checkpoint reportedly runs about 1.56 TB, hours after Tencent took Hy4 out of preview with native vision, computer use and open weights promised. On Tencent's own tests Hy4 scored 75.2 on APEX-Agents against DeepSeek V4.1 Flash-1017's 72.1 to 72.9.
AI Compute / Infrastructure — Voters in at least 29 US places approved bans or restrictions on data centres, and Goldman estimated Democratic wins could threaten 45% of US data-centre expansion. Texas' 474 GW of queued data and power projects were thrown into doubt after Gina Hinojosa won the governor's race on a pledge to crack down on server warehouses, while off-balance-sheet AI obligations at the tech giants rose 90% in six months to $3.2 trillion.
AI Policy / Safety — Oracle abandoned a $7 billion, five-year deal to lease 100,000 AI chips to Tencent under pressure from Trump, scuttling what would have been Tencent's largest overseas deal. CrowdStrike separately launched an AI "kill switch" that can shut down a company's agents, block them from restarting and cut their network access — state pressure is now cutting into contracts, not just chip shipments.
Crypto
Bitcoin — Investors pulled more than $1 billion from US-listed Bitcoin funds over two sessions and Bitcoin slipped below $76,000 as Democratic-sweep bets gained, before a reversal liquidated $320 million in shorts within 30 minutes and carried it to $81,000. Goldman argued Bitcoin was already trading at its "Democratic sweep" price; Saylor said reserve support is growing in both parties.
Crypto Regulatory / Institutional — Circle reported Q3 revenue and reserve income of $864.9 million against a $776.7 million estimate, with $104 billion of USDC minted versus $82.45 billion expected, and disclosed Binance taking a $100 million equity stake alongside a 5% staff cut. The CFTC approved "Equity Perps" on individual stocks for US-regulated exchanges for the first time, and a US judge then let stock perps trading continue.