AGP Executive Report

Middle East Risk-Off: Israel and Iran traded retaliatory strikes again, with Israel hitting targets in western/central Iran (including the Karun petrochemical complex in Mahshahr) after Iranian missile waves; sirens sounded across Israel and the West Bank as the April ceasefire teetered, while Trump urged Netanyahu to hold fire but said “I call the shots,” raising the odds of a wider regional pullback failure. Red Sea Shipping Shock: Yemen’s Houthis declared a “complete and total ban” on Israeli maritime navigation and warned of attacks on Israeli-affiliated ships, adding pressure to already strained trade routes. Markets & FX: The flare-up rattled global equities and lifted oil; Bitcoin slipped under $63K on geopolitical stress, while the shekel and regional currencies moved with the risk mood. Security & Espionage: Israel Police and Shin Bet arrested a Bat Yam man accused of working with Iranian intelligence, with an indictment expected. Business Impact Watch: Old Mutual’s OM Bank update showed customer growth in South Africa, but flagged that costs tied to the Israel-Iran conflict could weigh on earnings and insurance margins. Policy Signals: Bank of England policymaker Alan Taylor said rates can stay restrictive without hikes unless the “worst-case scenario” hits, as inflation pressures tied to the Iran war linger.

Middle East Escalation: Israel struck Beirut’s southern suburbs despite a US-brokered Lebanon ceasefire, killing two and wounding 20, and Iran retaliated by launching missiles at Israel—the first such barrage since April—raising fears the fragile truce is collapsing. Ceasefire Fallout: Iran’s parliament speaker warned US bases and Israeli assets are “legitimate targets,” while Hezbollah has rejected the Lebanon deal, keeping mediation efforts in limbo. West Bank Violence: A seven-month-old Palestinian baby was killed and his parents wounded after Israeli troops fired at a car near Hebron; Israel opened a military police criminal investigation. Security on the Home Front: A Palestinian citizen of Israel carried out a multi-site shooting in central Israel near the West Bank border, killing one and wounding five before police killed the attacker and arrested a suspected accomplice. Sanctions & Diplomacy: European countries, including France, are preparing new national sanctions tied to West Bank settler violence, as EU-level consensus stalls. FX & Economy: The Bank of Israel bought $801m in May to slow a sharp shekel rise, responding to exporter concerns. Business/Industry: Netafim’s Nefatim unit inaugurated a major precision-agriculture factory in Mexico, aiming to expand supply and create about 200 jobs.

West Bank & Gaza Violence: Israel strikes and ground operations killed at least seven Palestinians in Gaza City, while a seven-month-old baby (Sam Fahd Abu Haikal) was shot dead near Hebron and his parents were wounded, as Israel said it fired after a vehicle accelerated toward troops. EU Sanctions Push: France is coordinating with other countries on national asset freezes and travel bans for individuals linked to West Bank violence, after EU unanimity stalled. Israel’s War Cost Pressure: Bank of Israel Governor Amir Yaron put the multi-front war bill at 405 billion shekels ($138b) and warned defense spending is squeezing social programs. Iran War & Shipping Risk: US forces shot down Iranian drones near the Strait of Hormuz; Washington is also weighing using frozen Iranian assets to fund Gulf reconstruction, keeping a deal in doubt. Israel Business & Markets: Tel Aviv stocks rose Friday but the TA-35 is down 4.5% for the week; shekel weakened to about NIS 2.908/$; defense and retail led gains. Corporate Distress: Simad Holdings filed for Chapter 11 in New Jersey after owners allegedly emptied cash, suspending bond trading. Innovation Ecosystem: Jerusalem’s FourWard platform links universities, hospitals, and industry to commercialize medical and high-tech research. Diplomacy & Image: Slovenia’s president raised a Palestinian flag at her palace after a new government removed it from parliament, amid renewed international scrutiny of Israel.

West Bank Violence: A seven-month-old Palestinian infant, Sam Fahd Abu Haikal, was killed and his parents wounded after Israeli troops opened fire on their vehicle near Hebron; the IDF says it fired after perceiving a threat and is reviewing the incident. Diplomatic Pressure: Ireland banned far-right Israeli ministers Bezalel Smotrich and Itamar Ben-Gvir, citing inflammatory rhetoric and pushing for EU-wide sanctions; France is coordinating national asset freezes and travel bans tied to West Bank violence. UN Accountability: A new UN report blacklists Israeli forces for sexual violence in conflict zones, including treatment of Palestinian detainees—Israel denies the claims. Security & Tech Risk: The NYT reports the Pentagon raised its counterintelligence threat assessment for Israel to “critical,” describing Israeli intelligence collection on Trump officials as “unhinged,” and notes software found on US personnel phones. Lebanon Infrastructure: Lebanon began rehabilitating its second airport in Qlayaat, aiming to reopen within months as fighting with Israel continues. Gaza Ceasefire Talks: Hamas says Cairo talks focus on implementing the first Gaza ceasefire phase and planning second-phase arrangements.

West Bank Violence: A seven-month-old Palestinian baby, Sam Fahd Abu Haikal, was killed and his parents wounded after Israeli forces fired at their vehicle near Hebron, according to the Palestinian health ministry; Israel said soldiers fired single shots after perceiving a vehicle accelerating toward them. EU Sanctions/Travel: Ireland imposed entry bans on far-right Israeli ministers Itamar Ben-Gvir and Bezalel Smotrich, citing their role in Gaza unrest and comments about Palestinians. Security & Institutions: Netanyahu’s opponents warn he’s politicizing state bodies after a week of loyalist appointments, including Roman Gofman as Mossad chief and Michael Rabello as state comptroller. Defense Tech: Esh-Tech unveiled a low-power laser counter-drone system, aiming to neutralize threats in seconds. Israel Economy Outlook: The OECD forecasts Israel growth of 3.3% in 2026 and 5.6% in 2027, with war costs widening the deficit. Tech/Markets: Wall Street slid sharply after a strong US jobs report rattled chip and tech stocks. Privacy & AI Startup: Former Tinder privacy executive Ron De Jesus joined Tel Aviv-Boston startup Mine to lead trust, privacy strategy, and AI governance.

Diplomatic Pressure: Ireland barred far-right Israeli ministers Itamar Ben-Gvir and Bezalel Smotrich from entering the country, with the Taoiseach citing their Gaza stance and calling for EU-level sanctions. EU Reset: Slovenia’s new PM Janez Janša moved fast to reverse the prior government’s pro-Palestinian posture, signaling a diplomatic reset with Israel and paving the way for an embassy opening. Markets & Tech Rotation: Nasdaq and global tech stocks slid as investors rotated out of AI-linked megacaps; traders pointed to payrolls risk and still-elevated oil. US Economy Watch: The US added 172,000 jobs in May and kept unemployment at 4.3%, reinforcing labor-market resilience despite the Iran-war backdrop. Israel-US Military Integration: US lawmakers pushed to keep settlement pressure on E-1 while Israel and the US advanced talks to shift aid toward joint defense-industrial cooperation. Israel Business Angle: Israel’s data-center boom continues to draw global capital, with investors betting on power, land, and infrastructure advantages.

Israel-Lebanon Ceasefire Watch: The Trump administration says Israel and Lebanon agreed to implement a ceasefire tied to Hezbollah stopping fire and withdrawing from the South Litani sector, but Hezbollah immediately rejected the deal as “humiliating” and said resistance will continue while occupation remains; Israel also signaled it will keep operations in southern Lebanon, keeping uncertainty high for any wider Iran-related diplomacy. West Bank Settlement Push: Turkey condemned Israel’s approval of 2,162 new settlement units in the occupied West Bank, warning it undermines the two-state path and fuels settler violence. US-Iran Energy Spillover: With the Strait of Hormuz still constrained, markets remain jumpy; gold and silver slid on mixed Iran-deal signals while crude held near elevated levels. Israel Business Angle—Currency & Trade: A strong shekel is squeezing export value, with industry warning of broader economic damage. Global Markets: European stocks edged up as investors weighed ceasefire hopes against tech volatility after Broadcom’s drop. Labor & Rates: US job growth looks set to cool in May, with economists expecting the Iran-war inflation shock hasn’t yet hit hiring hard.

West Asia Ceasefire Clash: Hezbollah rejected the latest US-brokered Israel-Lebanon truce, calling it “futile and humiliating” and demanding full Israeli withdrawal, as Israeli strikes reportedly killed people and drones kept triggering alerts along northern Israel. Settlement Push & Diplomacy: Israel approved 2,162 new settlement homes in the West Bank, drawing condemnation from Türkiye and fresh US pushback via Marco Rubio, who said expansionist steps don’t match US policy. Legal/Prison Oversight: Israel’s Supreme Court ordered the state to allow ICRC visits to Palestinian detainees, overturning the wartime ban and raising pressure on detention transparency. Tech & Taxes: Nvidia and Google are exploring paying Israeli taxes in dollars instead of shekels after the currency’s sharp rise, following precedent tied to the Google-Wiz deal. Israel Economy Watch: Israel’s average high-tech salary hit a record 38,467 shekels in March, while broader market coverage tracked oil and equities reacting to ceasefire hopes and Iran risk. Business Finance: A summer-camp bond deal in Israel’s market is under scrutiny after a camp operator stopped payments to Israeli bondholders and transferred funds to related entities. Global Finance Spillover: The IMF increased support for several African countries to manage fallout from the US-Israel war on Iran, with energy and fertilizer shocks feeding food-security risks.

Israel-Lebanon Truce (US-led): Israel and Lebanon agreed to implement a conditional ceasefire after talks in Washington, with “complete cessation” of Hezbollah fire and the evacuation of Hezbollah operatives from southern Lebanon, plus “pilot zones” where the Lebanese army takes exclusive control of territory. Lebanon Escalation Risk: Hours after the announcement, Lebanon reported Israeli drone strikes in the south, underscoring how fragile the deal remains. Iran-US Pressure (Markets): Renewed Iran-US strikes around the Gulf—including attacks on Kuwait—kept investors in risk-off mode, lifted oil back near $97, and weighed on global equities. Defense Finance (IAI/Rafael): Israel Aerospace Industries and Rafael reportedly withheld government dividends to cover Defense Ministry debt exceeding NIS 10B, reflecting budget gaps tied to ongoing security demands. West Bank Settlement Push: Finance Minister Bezalel Smotrich advanced plans for 2,162 new settlement homes, intensifying international legal and diplomatic backlash. Tourism Signal: Israel’s tourism chief said Israel remains open and safe despite the war’s impact, arguing no tourists have been harmed in recent years. Forced-Labor Trade Rules: The US flagged Israel among countries failing to enforce forced-labor import bans under Section 301, raising compliance and trade friction risks. Israel’s Defense Exports: Israel set a record in 2025 with $19.2B in defense exports, up nearly 30%, despite boycotts and exclusion from some arms events.

US-Iran diplomacy vs Israel’s Lebanon fight: Trump said he called Netanyahu “crazy” and is “perturbed” Israel’s Hezbollah war is slowing Iran talks, while Netanyahu insists the alliance is intact. Lebanon ceasefire under pressure: Fresh Israel-Hezbollah exchanges continued after Washington-brokered efforts, with Hezbollah rejecting any “partial” truce. West Bank settlement push: Finance Minister Smotrich approved 2,162 new settlement homes, deepening disputes over Palestinian statehood. Detentions of Palestinian athletes: Israel extended detention of women’s national team player Rand Halawani and arrested Natalie Abu Diyeh, drawing condemnation from Palestinian officials and universities. US trade policy: USTR announced new Section 301 tariffs tied to forced-labor enforcement across dozens of economies. Markets and inflation spillover: US services activity picked up in May, but input prices rose amid Iran-war shipping disruptions. Crypto sanctions: US Treasury sanctioned Iran’s Nobitex and other exchanges under “Economic Fury.” Business/tech: Brookfield is betting big on AI infrastructure; Israeli observability firm Coralogix raised $200m.

Israel–Fiji Diplomacy: Israel opened its embassy in Suva, with FM Gideon Sa’ar and Fiji PM Sitiveni Rabuka calling it a milestone for Pacific ties and economic cooperation. AI & Finance: Bank Leumi topped a Middle East AI adoption index, highlighting an AI center and efficiency gains as Israel’s tech push stays strong. Geopolitics & Markets: OECD warns that if the Iran conflict drags into 2027, global growth could slump and energy shortages could hit AI datacenters and industrial inputs. Crypto Sanctions: U.S. Treasury sanctioned Nobitex and other Iranian crypto exchanges under “Economic Fury,” targeting sanctions evasion networks. Trade Policy: USTR advanced Section 301 forced-labor findings, proposing new tariffs that could spill into U.S.-India negotiations. Lebanon Front: Israel and Hezbollah kept trading fire despite Trump’s claimed halt, while Iran reportedly paused mediator talks—raising uncertainty for regional shipping and energy. Tech Economy: Israel’s high-tech exports hit record levels, but a new report flags a shift of R&D and senior roles abroad, even as funding and exits rebound.

Knesset Snap Election Move: Israel’s parliament approved a first reading to dissolve the Knesset and trigger elections in about 90 days, with voting set between Sept. 8 and Oct. 20—adding to political strain on Netanyahu’s coalition. Lebanon-Iran Deal Pressure: Trump said US-Iran talks are continuing “at a rapid pace” despite Iran suspending indirect talks over Israel’s Lebanon campaign; meanwhile, Israel kept striking southern Lebanon even after ceasefire claims, keeping oil and market nerves high. Defense Trade Friction: France barred Israel’s defense ministry from Eurosatory in Paris, allowing only air-defense displays—sparking an Israeli backlash and raising questions for defense exporters. Energy & Shipping Risk: MSC said its containership was hit in Iraq’s Umm Qasr; IRGC claimed responsibility, while MSC called it unjustified—another reminder of how the Gulf conflict is disrupting trade routes. West Bank & Jerusalem Tensions: Reports highlighted Eid-era violence, settler attacks, and renewed administrative detention orders for dozens, alongside continued Al-Aqsa restrictions and demolitions. Tech/Capital Markets: Motorola Solutions agreed to buy Israeli drone defense startup D-Fend for $1.5B, while Israel’s defense exports were reported at a record $19B+ in 2025.

Israel-Hezbollah diplomacy & Iran talks: Trump says Israel and Hezbollah agreed to halt hostilities after calls with Netanyahu, but Axios reports a furious phone exchange where Trump told him “everybody hates Israel,” while Iran warns it may suspend talks if strikes continue, keeping the ceasefire fragile. Lebanon ground realities: Israel’s deepening Lebanon push and the capture of Beaufort Castle underscore how “buffer zone” talk collides with invasion concerns, while UN chief Guterres urges keeping UNIFIL peacekeepers in place. Gaza control dispute: Netanyahu orders the military to expand control to 70% of Gaza, raising alarm over forced displacement and potential breach of ceasefire understandings. West Bank politics & economy: Smotrich faces a Knesset reversal on VAT import exemptions, while he also calls for dismantling the Palestinian Authority—amid ongoing settlement expansion plans and settler violence reports. Energy & markets: Hormuz risk and US-Iran flare-ups keep oil and global risk sentiment jumpy; Asian stocks swing as investors weigh AI strength against Middle East uncertainty. Israel business & tech: Motorola buys Israel’s D-Fend for $1.5B; Israeli mobility/AI and API security firms keep fundraising and product launches moving. Aviation: Wizz Air reports strong May passenger growth, including Champions League traffic, and resumes/expands Israel routes.

Middle East Ceasefire Tensions: Iran says the US ceasefire covers “all fronts, including Lebanon,” warning that any violation would trigger consequences; it also reports Tehran is halting indirect talks with Washington after Israel ordered troops to push deeper into Lebanon, while Trump claims Israel and Hezbollah agreed to dial back attacks. Oil & Markets: Energy traders reacted to the Iran-US negotiation wobble and Lebanon escalation, with oil jumping then partially easing as investors weigh Strait of Hormuz risk and the odds of a deal. Defense & Trade Friction: France barred Israel’s official participation in Eurosatory in Paris, limiting Israeli defense firms to air-defense displays and excluding offensive systems—sparking an Israeli backlash. Domestic Disruption: Ultra-Orthodox protesters blocked roads and trains nationwide over the military draft, causing major traffic chaos. Israel Business & Growth: Haifa Bay Authorities appointed media executive Frank Melloul to lead international outreach, positioning the region as a gateway for trade and investment tied to IMEC and the Abraham Accords. Tech & Industry: Motorola Solutions agreed to buy Israeli drone-defense firm D-Fend for $1.5b, underscoring Israel’s role in counter-drone innovation. Education Philanthropy: The Leviev Foundation announced a $50m, five-year scholarship and grants push for underserved Jewish children. Israel Mobility: El Al plans to resume San Francisco flights, linking Tel Aviv and Silicon Valley.

Israel-Lebanon Escalation: Netanyahu ordered deeper IDF strikes, including attacks on Beirut’s Dahiyeh, after troops seized Beaufort Castle in the deepest Lebanon incursion in 26 years, as Hezbollah keeps firing drones and rockets. Settlement Expansion: A Palestinian commission says Israel is set to advance plans for 2,700+ new illegal West Bank settlement units, with zoning and boundary changes on the agenda. Gaza Control Push: Netanyahu’s plan to expand Gaza control from 60% to 70% is framed by critics as a ceasefire and peace-plan violation. UN Accountability: UN-linked reporting highlights renewed focus on conflict-related sexual violence, with Israel added to a blacklist. Energy & Markets: Oil jumped over 2% on fears the Israel-Iran-US cycle will disrupt Hormuz; gold slipped on a stronger dollar. FX Pressure: India’s rupee slid 9 paise to 94.94 as crude rose. Tech & Jobs: Wix is cutting about 20% of staff and blaming AI; Uber and Israel-based Autobrains plan a Munich robotaxi rollout with Nvidia. Regional Diplomacy: Saudi Arabia reiterated “No Palestinian State, No Normalization,” while the US floated a new Israel-Hezbollah ceasefire framework amid stalled Iran talks.

US-Israel defense integration: A new US National Defense Authorization Act draft includes Section 224, creating an “executive agent” for deeper US-Israeli defense technology cooperation—sparking bipartisan pushback in Congress over reduced oversight and harder-to-unwind ties. Lebanon incursion & diplomacy: Israel’s Netanyahu ordered troops to expand ground operations in Lebanon after seizing Beaufort Castle, while France demanded an emergency UN Security Council meeting and warned the advance is “extremely concerning.” Energy & shipping costs: With the Strait of Hormuz effectively disrupted, global fuel pressure keeps hitting budgets; Sri Lanka raised fuel prices after an IMF tranche, and Iran reported partial gas output restoration at South Pars. Trade & logistics: Aqaba Port received 44,000 tons of US rice for Iraq despite regional shipping disruptions. Israel business & consumer pressure: Israel’s online marketplace boom is drawing warnings about foreign sellers and unverified products, as VAT-free import rules boost cross-border e-commerce. Tech & healthcare: Israeli med-tech startup PatenSee is expanding in Michigan with Henry Ford to improve dialysis vascular access monitoring using AI imaging. Security & labor reality: Reports from the West Bank highlight economic desperation driving workers to risk the barrier into Israel, after shootings at the wall.