The Mines Are Gone. Also, Someone Should Go Clear the Mines.

Tuesday, August 25. Closes and moves against Monday's close.

Oman's foreign minister, Badr Albusaidi, flew to Tehran on Tuesday to meet his Iranian counterpart, Abbas Araghchi, and the two announced they had discussed a phased framework for a temporary joint shipping lane through the Strait of Hormuz, as well as a joint project to clear the strait of mines. A phased framework is a document describing the order in which people intend to agree on things later, and on the strength of it, crude's ETF proxy dropped 4.58%, from 132.21 to 126.15, gapping lower at the open and never coming back.

Nothing was signed. Technical talks continue, which is what diplomats call the part where everyone goes home and reads the small print. This is the eighteenth straight edition in which we have found nothing in the Strait of Hormuz actually enacted, and the tape keeps paying full price for paperwork that does not exist yet.

The comedy is in the timing. Hours before Oman and Iran proposed teaming up to clear the mines, President Trump announced they were already gone, saying the US Navy had informed him "all mines have been removed and/or detonated from within the International Waters of the Strait of Hormuz." International waters is the load-bearing phrase there, since it politely excludes the territorial waters where the rest of the strait lives. One waterway, one afternoon, and a mine-clearing job that is either finished or has not started depending on whose map you use.

Energy equities were less impressed. The energy sector ETF fell 1.66% and Exxon 2.08%, about a third of what the barrel did, because oil companies have seen this movie and know the credits are not rolling. Then, after the close, the American Petroleum Institute reported a 4.2 million-barrel build in US crude stockpiles against a 1.8 million-barrel estimate, and crude kept sliding on the far less romantic news that there is a lot of oil sitting in tanks.

Cheaper oil eventually means cheaper everything, so the bond market ran straight to the finish line without waiting for the race. The 10-year Treasury yield fell 6.7 basis points to 4.634%, and the 30-year fell 5.9 basis points to 5.169%, with a basis point being one hundredth of one percentage point, which sounds trivial until you remember the entire mortgage market is priced off the result. Long bonds rose 1.10%.

Tuesday's data helped, in the way a limp handshake helps. Consumer confidence came in at 89.4 against a 90.3 estimate. New home sales landed at 607,000 versus 620,000 expected, down 10.5% from June's 678,000. The Richmond Fed's manufacturing index printed 4 against 7, and its services index managed -8 against -1, which is less an economic indicator than a mood ring. That is the kind of softness that makes a bond trader cheerful and a homebuilder update their resume.

One number refused to play along. The Redbook index of chain-store sales ran 9.1% above a year ago, up from 7.6% the prior week. The American consumer told a survey they feel worse, then went out and spent more than last week, which is the most honest thing anyone did all day.

Nvidia rose 2.19% to $213.05, ending a seven-session losing streak that had taken it down 7.47% from its August 13 close of $225.30. Not a rally so much as an exhale. AMD gained 4.91%, Micron 2.48% and the semiconductor ETF 1.65%, while Broadcom slipped 0.56% and got left holding everyone's coats.

The bounce has impeccable timing, since Nvidia reports after today's close and the options market is pricing a move of roughly 5% in either direction. De-risking Monday and re-risking Tuesday is not a strategy; it is a coin flipped twice by people who would prefer you call it positioning.

The overnight tape also carried word that OpenAI's new in-house chips, which are named Jalapeño, beat Nvidia's current Blackwell lineup on some inference tests. Inference is the cheap repetitive part where a trained model answers your question, rather than the ruinous part where it learns to, and it is exactly the slice a customer would most like to stop renting. That customer is one of Nvidia's largest.

Here's the Thing: Nvidia's earnings report has become the only one that retroactively decides what the previous month meant. If it lands, last week's seven-day slide was a sale. If it misses, Tuesday's bounce was a trap, and everyone will say they saw it coming. No conviction survives contact with a press release at 4:20 PM, and pretending otherwise is how people sell the bottom twice.

Wednesday is the whole week compressed into one calendar. All times Central.

7:30 AM, July PCE from the Bureau of Economic Analysis. The Fed's own preferred inflation gauge, not CPI, and the most consequential number of the week without Jensen Huang's name on it. Headline is expected at +0.1% monthly against -0.1% prior and 3.6% annual against 3.7%; core at +0.2% monthly and 3.3% annual, unchanged. Personal spending and durable goods orders are released together.

9:30 AM, EIA weekly crude stocks, expected at a build of 1.9 million barrels. The API already said 4.2 million last night, so oil has been warned. Noon, the 5-year note auction, where the bond market gets asked to put money where Tuesday's enthusiasm was.

After the close, the main event. Nvidia is expected to report earnings of $2.09 per share, with Salesforce ($2.35), Synopsys ($2.66), HP ($0.66), Okta ($0.44), and CrowdStrike ($0.05) all reporting the same evening. Five of those six will be lucky to get a paragraph.

Then Jackson Hole, scheduled Thursday through Saturday, with Fed Chair Kevin Warsh's first keynote as Chair scheduled for Friday at 9:00 AM CT. He has spent the year calling inflation too high and stripping forward guidance out of the statement, and last week's July minutes showed the hawkish camp is wider than the three members who dissented.

The one thing that could ruin everyone's day: a hot core PCE at 7:30 followed by a soft Nvidia guide after the bell. Yields back up, chips back down, and the entire "peace is coming, inflation is cooling" story that carried Tuesday unwound in one session by two numbers with nothing to do with each other.

Bonds bought the ceasefire, oil sold the war, and gold is up 15.22% this month quietly betting they are both wrong.

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