Goldman Sachs: Yen Strength, Energy Risk and AI Momentum Drive Markets - FJElite

Asian technology and semiconductor stocks rallied as GPT-6 momentum continued, with SoftBank up roughly 30% in three days. The bigger surprise was the yen’s sharp appreciation after stronger Japanese wage data reinforced expectations for further BoJ tightening. That raises fresh questions around a potential yen carry-trade unwind and the implications for global equities and credit, while Japanese exporters are underperforming as they face both a stronger currency and higher energy costs.

Energy remains the clearest near-term risk to equities. Iran’s proposed exclusion zone could further restrict ship-to-ship transfers, while Hormuz flows are still only around 10mb/d and refined-product markets remain tight. There is some optimism around diplomacy as Iran says talks with Oman are nearing agreement, but there is still no operational solution or broader US deal. Russia-Ukraine tensions are also adding risk for Europe, while copper continues to make new LME highs despite stagflation concerns, reflecting supply constraints, tariff distortions and still-strong spending rather than a pure growth signal.