Wealthion Macro Bites – Tungsten Stock Soars 55% on $450M Defense Department Deal

In early Tuesday trading, the 10-year Treasury yield surged 5.1bps touching a high of 5.039%, surpassing ’23 peaks to hit the highest level since ’07.  The bruising global bond market selloff is being driven by surging energy prices, spiraling debt levels and mounting inflation fears.  Odds of a rate hike at the Fed’s current FOMC meeting have risen to 93%.  With market expectations this pronounced, it would be difficult for the Fed not to follow through with a “precautionary” hike.

Yemeni officials stated Iran-backed Houthis fired dozens of missiles and drones at a military airbase in southern Saudi Arabia targeting aircraft hangers, radar systems, runways and ammunition depots, while simultaneously digging into coastal positions along the Red Sea.  Oil market traders fear a prolonged shutdown of the Saudi pipeline across its territory from the Gulf to the Red Sea could cut off as much as 4% of global supply at the same time the Strait of Hormuz remains largely blocked.

The EPA announced rules repealing the Biden administration’s limits on carbon emissions from coal and gas-fired power stations.  Citing its lack of legal authority under the Clean Air Act to regulate greenhouse gas emissions, EPA also rescinded remaining greenhouse gas emissions requirements for power plants to prevent future climate regulations targeting the power sector.  EPA said the moves will enable the U.S. to build much needed new generating capacity and infrastructure to meet the country’s energy needs.

The U.S. Department of War announced a $450M binding agreement with Elmet Group (ELMT) and Australia’s EQ Resources (EQR ASX) to secure and expand U.S. tungsten manufacturing and stockpiles.  Of the total investment, $150M is earmarked for Blue Moon Metals’ (BMM) Springer tungsten complex in Nevada.  BMM will receive a $50M tungsten concentrate prepayment facility and a $25M equity investment, while ELMT will commit another $75M to a JV restarting Springer’s ammonium paratungstate plant.  ELMT already supplies tungsten to U.S. defense programs, including Patriot and Javelin missile systems, Trident II missiles, and Virginia- and Columbia-class submarines.  ELMT shares soared as much as 55% in Monday trading before closing up 33% on the day.

AI watch: Anthropic CEO Dario Amodei fomented gathering AI angst in announcing his company would introduce new safeguards for AI development.  He urged the AI industry to slow the development of its most advanced models.  OpenAI’s Sam Altman backed the proposal, and Elon Musk posted, “Dario is right.”  President Trump promptly posted, “The only control or ‘guardrails’ that AI needs is a STRONG AND SMART (High IQ!) PRESIDENT, and the U.S.A. has that, in spades!”