In recent months, the global economy has witnessed a significant shift towards artificial intelligence (AI) infrastructure, with Monster LT and Snowflake leading the charge. According to a recent report, Monster LT is expected to reach approximately $115 billion in FY27 and $230 billion in FY28, while Snowflake has shown accelerating product revenue, higher guidance, and a strong reaction from investors. However, the competition in custom silicon is becoming more visible, raising questions about the stock’s potential performance.

Despite these developments, energy remains a crucial factor in shaping the market’s trajectory. The recent WSJ report suggesting that President Trump is exploring the possibility of declaring the Iran war over has sparked renewed interest in the oil market. With oil prices surpassing $90 and product markets tightening, gasoline matters politically, and interceptor inventories are reportedly stretched. While some analysts believe this could be an escalation to de-escalate, others suspect that we may see a different approach after Labor Day.

In the meantime, AI equities face a critical test today with Waller as the obvious event. The market’s ability to trade positively on objectively good news will be put to the test, and investors are eagerly awaiting proof that the durability of AI spend can outrun compression in the economics. Broadcom and Snowflake hold the key to unlocking this potential, but the question remains whether they can provide enough momentum to restart the multiple cycle.

Core to our view is that as long as energy prices are stable or higher, markets will remain stable or higher. However, the recent rally in agriculture due to favorable weather and global disruptions has provided a welcome boost to the sector.