بسم الله الرحمن الرحيم
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Here's what moved markets and what it means for the halal investor.
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↔ Iran offered, Oil wasn’t convinced
Iran proposed reopening the Strait of Hormuz Monday, conditional on Washington lifting its naval blockade. Oil wasn’t convinced. Brent pushed above $111 a barrel and WTI gained 3.14% to $102. About 20% of seaborne oil and a fifth of global LNG normally pass through Hormuz. Those flows are still halted.
The S&P held at 7,138, down half a percent but still indifferent to the energy story. The AI capex cycle has its own gravity.
Gold was down to $4,609. Two forces are working against it: the Fed is expected to hold tomorrow, removing any near-term catalyst, and some emerging-market central banks appear to be lightening positions to defend their currencies. The Bank of Japan held rates Tuesday, but three of nine board members voted for a hike, a sign that Middle East inflation risk has migrated from commodity markets into monetary policy.
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🔍 PIF's TAKE
Hyperscalers are likely to hold or raise their capex guidance. A period of Gold retracement and consolidation is also to be expected in light of its recent meteoric run. The main risk that markets are grappling with is what sustained elevated energy prices do to the broader economy. |
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😉 $POET ( ▼ 7.81% ) Never Really Rhymed
POET Technologies' shares plummeted nearly 50% on Monday after the company revealed it had lost a key contract with Celestial AI, which was recently acquired by Marvell Technology (MRVL).
According to Marvell, the contract was terminated because POET had breached its confidentiality obligations, specifically by disclosing information related to the purchase order and shipping details without authorization.
But even before this fallout, one question lingered: was the company's valuation ever grounded in reality?
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🔍 PIF's TAKE
Before the 50% plunge, POET was already trading at a steep 2027 forward P/S ratio of around 30x, more than double that of industry leaders like Lumentum. Even after the selloff, the stock still trades at roughly 15x 2027 sales. With Marvell now gone as a client, those revenue estimates may well be revised downward, making the shares look even more overvalued relative to peers.
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A 50% drop, a lost contract, and a valuation that was always hard to justify. See what's on our watchlist instead, names where the fundamentals actually hold up. See the Names Where the Fundamentals Actually Hold Up → |
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Is $ABBV ( ▼ 0.93% ) Halal?
A member recently asked whether we are comfortable investing in AbbVie ($ABBV). The case is easy to like on the surface, dominant pharmaceutical franchise, strong dividend history, growing oncology pipeline.
The discomfort runs deeper than the headline numbers suggest.
AbbVie carries close to $59 billion in debt, a legacy of its 2020 Allergan acquisition. That leverage shows up on the income statement. Over the past four quarters, interest expense has averaged around 5% of total expenses per quarter, against our 2.5% threshold. The threshold must be breached in all four consecutive quarters to constitute a fail. AbbVie breaches it in every one of them, by a wide margin.
We do not reach the financials before hitting a harder stop. AbbVie maintains an R&D facility in Israel, which is a redline for us regardless of size or materiality. A research and development presence is a strategic commitment, not passive commerce.
Either issue alone would be enough. Together, they make the answer straightforward. We are not comfortable with $ABBV.
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Your halal investing questions answered daily. Join the Discord → |
Tomorrow: the Fed decides, and the hyperscalers report. Two answers that could move everything. Stay principled, stay patient.
With barakah,
Team @PIF
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