Instead of the rebound US stocks hoped for, they were suppressed by both oil prices and interest rates.

Last week, Brent crude closed near $117 per barrel, while WTI crude also rose above $103; The Dow Jones fell 1.23%, the S&P 500 dropped 0.52%, and the Nasdaq declined 0.21%. The 10-year Treasury yield returned to 5.00%, while gold instead fell below $4,000.

This is not just an ordinary case of "rising too much and then pulling back." What the market truly worries about is that rising oil prices will reignite inflation, squeeze the Fed's policy space, and put valuation pressure on popular sectors like AI, consumer, and finance.

| It's not that the oil is running out, but that transportation and refined oil have become tighter

This round of oil price increases directly triggered the escalation of tensions in the Middle East.

The Houthis have repeatedly attacked Saudi oil facilities and targets in the capital region. Saudi Aramco has arranged for some personnel from its Dahran headquarters to evacuate, and new security risks have emerged for shipping in the Strait of Hormuz.

But more importantly, the focus of market pricing is no longer "whether there is crude oil," but "whether it can be shipped out cheaply and smoothly."

Morgan Stanley's data shows that Middle Eastern crude oil exports have recovered to about 94% of pre-conflict levels; However, spot Brent spot prices were once about $10 higher than futures during the same period, indicating that the physical market is tighter than the futures market.

Supplies of refined oils such as diesel and heating oil remain tight, and the G7's release of strategic oil reserves and Germany's tender sale of inventory failed to immediately suppress prices.

Goldman Sachs believes that current oil prices already include a risk premium above $20 per barrel, and unless full-scale war repeats, Brent may not easily hold above $120.

But in the short term, as long as expectations of prolonged Middle East conflict persist, oil prices will find it difficult to fall quickly.

| The market is repricing "inflation + interest rates"

Typically, when geopolitical risks rise, U.S. Treasuries are bought in. But this time is different: the faster oil prices rise, the more worried the market is about a rebound in inflation.

10年期美债收益率上行至5.00%，说明资金并没有安心躲进债券里，而是在担心美联储可能被迫维持更紧的货币政策。这直接压制了高估值资产，尤其是利率敏感型板块。

So the biggest drops weren't tech stocks, but defensive consumer stocks like Coca-Cola and Procter & Gamble.

Their logic is simple: when bond yields are high enough, the attractiveness of stable dividend assets decreases; When oil prices push up the cost of living, consumer confidence will also be under pressure.

| Energy stocks strengthened against the trend

The energy sector was one of the few bright spots, with sector indices reaching historic highs.

Schlumberger rose 7.08%, Halliburton rose 5.21%, and ConocoPhillips and ExxonMobil also rose. This is not surprising: rising oil prices have directly improved profitability expectations for oil services and gas companies.

Tech stocks, however, showed divergence. Apple's market value once surpassed Nvidia's during trading, but ultimately closed down 0.14%; Microsoft saw a slight increase; Google, Meta, Amazon, Tesla, and most Nvidia closed lower. Chip stocks have recovered after the previous day's sharp drop, with Micron, Mywell, AMD, and Intel all rebounding, but the memory sector remains weak.

This indicates that AI trading is entering its second phase: the market no longer only looks at "who invests more," but rather on "who can afford to invest, invest long-term, and invest efficiently."

When interest rates are high and financing costs increase, free cash flow and capital expenditure discipline become more important than mere growth stories.

Kingtech Perspective | Guard against volatility first, then look at structure

Currently, the market is in a period of four overlapping factors: oil prices, interest rates, financial reports, and geopolitical factors, so volatility will not disappear quickly:

1. Do not chase energy stocks high in the short term. The energy sector has already reflected many expectations for rising oil prices, making it better to wait for a pullback to assess the profitability sustainability of oil services, upstream oil and gas, and refined oil chains.

2. AI Focus Shifts from "Theme" to "Quality" Prioritize computing power, storage, optical interconnection, and server chains with orders, cash flow, and capacity fulfillment, and stay away from purely conceptual, high-valuation, high-capital expenditure targets with unclear profit paths.

3. Focus on three key points: the Federal Reserve's interest rate meeting statements, US PCE inflation data, tech giants' earnings reports, and capital expenditure guidance. These three factors will determine whether the market shifts from "inflation concerns" back to "earnings support" or continues to defend.