Name two major events.

【Answer 1】 Over the weekend, I carefully reviewed recent market trends and news developments. My strongest impression is this: at this stage of the downturn, obsessing over fundamentals has lost much of its relevance. The ChiNext Index has fallen more than 40% from its July peak; the Hong Kong stock market has completely erased last year’s bull run; the Philadelphia Semiconductor Index recently posted eight consecutive losing sessions—the longest such streak since 2008; and while the Nasdaq Composite remains relatively stable, it has been trending downward steadily. This kind of broad-based decline cannot be explained by minor differences in individual companies’ earnings—it reflects liquidity conditions and investor sentiment. So in the short term, don’t fight the fundamentals—focus instead on news catalysts. After careful reflection over the weekend, I concluded that only two developments currently hold genuine power to shift market direction: Federal Reserve interest-rate hikes and AI. Let’s start with the rate-hike logic—and to understand it, we must begin with the Middle East. Global oil prices are, in essence, dictated by the situation in the Strait of Hormuz. The U.S. midterm elections fall on November 3, and Israel’s parliamentary elections on October 27—both within two weeks. Both sides are pressuring Iran to back down. Netanyahu’s tough rhetoric—claiming he intends to topple the Iranian regime—is less about policy and more about electioneering, given his trailing poll numbers; Trump’s position is even more contradictory—he wants to strike but fears soaring gasoline prices will alienate his own voters. Iran, for its part, has taken an even bolder stance—citing the seven undersea fiber-optic cables running through the Strait as leverage, signaling clearly: “Touch us, and the Middle East goes offline—plus, we’ll blow up the Strait.” Brent crude has already surged past $117 per barrel, rising over 80% this year. U.S. gasoline prices have followed suit, causing real pain at the pump for American consumers—precisely the vulnerability Republicans face ahead of the midterms. Higher oil prices mean stubborn inflation. The U.S. September CPI came in at 3.7% year-on-year—a figure critically important in the current hiking cycle, as it strongly influences the Fed’s decision-making. Now the dilemma sits squarely before Fed Chair Jerome Powell (note: original text mistakenly names “Wash” — corrected here to Powell). The current target federal funds rate stands at 3.75%–4.00%; the Fed raised rates once in September, characterizing that move as a partial reversal of prior easing—and then immediately stressed it would not pre-commit to any future decision, a classic case of keeping options open. The October meeting will most likely hold rates steady, but markets now assign roughly a 90% probability to a 25-basis-point hike in December. Here’s an interesting twist: In September, rate hikes barely moved U.S. Treasury yields—but now, amid the recent collapse in chip and AI stocks, the 10-year Treasury yield has dropped significantly, falling back below 5%. Why? Because money fled into long-dated Treasuries for safety as AI stocks crashed. My take on the rate-hike logic is straightforward: A December hike is highly probable—but that doesn’t mean the sky is falling. As history shows, the first one or two hikes in a cycle rarely kill a bull market outright. Between 1999 and 2000, the Fed hiked rates repeatedly, yet the dot-com bubble didn’t burst until March 2000. The AI sector is certainly not at its endpoint—though I’m referring specifically to U.S. tech stocks. Chinese A-share valuations may already reflect several years’ worth of optimistic expectations, so while fundamentals remain sound, I won’t guarantee share-price performance. High-dividend and income-oriented stocks—insensitive to rate hikes—will likely continue following fundamentals. Moreover, what truly hurts investors is the volatility *during* the hiking cycle—especially when layered atop rapid AI development, causing sharp price swings. For A-shares and Hong Kong stocks, U.S. dollar rate hikes act like a vacuum cleaner sucking capital overseas. Tech and growth stocks inevitably suffer—simple reason: higher Treasury yields compress the present value of distant cash flows, crushing valuations.

Israeli parliamentary elections have concluded, and exit polls show Netanyahu’s bloc fell short of a majority. How should we interpret this result? What fate awaits Netanyahu?

【Answer 2】 Written: Oct 27, 2026, 09:33 PM GMT I don’t care who wins Israel’s election—but given the current situation in the Strait of Hormuz, the resulting surge in global oil prices, mounting inflationary pressures, slowing global growth, plus the personal political alliance between Trump and Netanyahu—and indeed the broader strategic U.S.–Israel alliance—the outcome of this Israeli election carries exceptional significance for both the global economy and Middle Eastern geopolitics. In short: Netanyahu is unlikely to secure a stable governing majority—but his chances of remaining in the Prime Minister’s office remain quite substantial. Even if he ultimately loses, Israel’s hardline stance toward Iran will not undergo any fundamental reversal. Nor will the Washington–Jerusalem alliance collapse. That said, should Netanyahu genuinely lose power, the political objectives of Middle Eastern warfare, the modalities of U.S.–Israeli strategic coordination, and long-term security arrangements for the Strait of Hormuz could all undergo major adjustments. What truly merits attention is whether a change in Israel’s leadership might open a political window for the U.S. to end its confrontation with Iran. If achieved, global energy markets could be repriced—and the war-risk premium embedded in oil prices could shrink rapidly. Conversely, if Israel descends into prolonged political deadlock, the region’s existing military tensions and energy-transport risks will remain fundamentally unresolved. Let’s examine the newly released exit polls: I. Winning Votes ≠ Winning Power According to Reuters’ report late on October 27, exit polls conducted by three major Israeli television networks project that the opposition bloc led by former IDF Chief of Staff Gadi Eisenkot will win 52–53 seats, while Netanyahu’s right-wing bloc is expected to secure around 50 seats. The remaining 17–18 seats are projected to go to Arab parties whose alignment with either bloc remains unclear. At first glance, Netanyahu appears doomed. But Israel operates under a parliamentary system: the Prime Minister must command parliamentary support to form a government. With 120 total Knesset seats, an absolute majority requires 61. Neither bloc reaches that threshold. Forming a coalition with Arab parties also seems unlikely. The opposition bloc’s internal political spectrum is extraordinarily wide—spanning centrists, traditional right-wingers, secular nationalists, and left-wing advocates of a two-state solution. Uniting them solely to oppose Netanyahu is relatively easy; negotiating concrete agreements on national security, the Palestinian issue, religious obligations, and conscription rules will prove far more difficult. Especially notable is Avigdor Lieberman, a right-wing leader who has long categorically opposed relying on Arab parties to form a government. Eisenkot himself has likewise ruled out formal coalition talks with Arab parties. Thus emerges a curious paradox: those opposing Netanyahu may hold a parliamentary plurality—but those willing to jointly endorse an alternative government may still fall short of the 61 votes needed. Theoretically, Eisenkot could seek support from ultra-Orthodox parties. Yet one of their core political demands—exempting yeshiva students from mandatory military service—directly contradicts a key unifying platform of the opposition: expanding conscription obligations.

Oil Holds Decline as Traders Track Result of Israeli Election

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Oil prices hovered near $100–$114 per barrel as traders monitored the Israeli election outcome amid Middle East tensions. US crude stockpiles also fell by 2 million barrels last week, indicating tighter supply.

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Oil Holds Decline as Traders Track Result of Israeli Election

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