Yesterday US equities ended August on a down note. The US and Iran traded strikes over the weekend and oil and long-end yields rose. The S&P fell 0.3%, the equal-weight dropped 0.6% and Russell 2000 0.5%. Energy was the outperformer. Tech was modestly higher as software continued to see upside momentum and memory traded higher while the megacaps fell. Defensives performed relatively well, though Utilities got hit on unfavorable California wildfire legislation as well as the backup in yields. A late day rally off the lows on end-of-month flows and MSCI rebalancing pushed equities to end the day near their highs, though still in the red.

The flareup in Iran over the weekend continued last night after Iran struck two tankers in the Strait of Hormuz. S&P futures were trading around flat before the news broke but moved to their lows. We’re starting out the historically worst month for stocks right on cue. The S&P 500 opened down 0.7% and we've been drifting in the red like a Chevelle song, though in a relatively tight intraday range. Support has held at the low-end of the range we've been in since the beginning of August (~7630), and we are testing it again as we hit print.

Energy is leading on oil's gains, while the defensively-oriented Staples and Healthcare sectors are also higher. but the internal complexion for Healthcare leans defensive. Discretionary is lagging, with Travel & Leisure, retailers and Homebuilders lower (soft residential Construction Spending data and yields/macro). Amazon and Tesla are also down 2-3%. Industrials is another laggard. Tech is lower with broad weakness in both semis and software (cyber in particular), but Apple's 3% gain is helping mitigate some of the downside. We'll get some important tech earnings tonight, including DELL.

Crude is up another 4% today, initially higher on the overnight tanker news, and then took another leg up after the US struck Iranian targets in the Strait/ Gold is trying to hold the 100d ma and $4400 level after hitting resistance at $4700 last week. Silver is reacting similarly after it hit $70. Bitcoin and ETH are down 2% as both continue to digest the late August rally. Ag is higher with escalating tensions between Europe, NATO and Russia after Germany officially accused Russia of targeting the Leipzig airport with drones last month.