US Reinstates Hormuz Blockade, Market Ignores Geopolitical Shock

The financial markets delivered a masterclass in bullish divergence today, completely ignoring a weekend of severe geopolitical escalation. Despite the United States reinstating a naval blockade in the Strait of Hormuz and proposing a cargo toll, risk assets remained heavily bid. Volatility actually compressed and corporate credit markets showed zero signs of stress, indicating that institutional investors are looking past the immediate headlines toward upcoming inflation data.