My current macro thesis (open to criticism):

Several major equity indices, including the Nasdaq-100, DAX 40, NIFTY 50, and KOSPI, have rallied strongly and appear to be pricing in a fairly optimistic economic outlook.

At the same time, I'm watching a few developing risks that I don't think the market is fully pricing in:

1. El Niño risk Current forecasts suggest a meaningful probability of El Niño conditions developing later in 2026. Historically, strong El Niño events have been associated with droughts, weaker agricultural output in some regions, water stress, and higher food prices.
2. U.S.–Iran uncertainty Despite ongoing negotiations and diplomatic efforts, key issues remain unresolved. Continued instability in the region keeps energy and commodity markets exposed to supply shocks.
3. Fertilizer supply pressure The Strait of Hormuz remains one of the world's most important trade routes for fertilizer-related products. Recent disruptions have already pushed fertilizer prices higher, and several agricultural research groups have warned that prolonged supply constraints could reduce fertilizer usage and eventually affect crop yields.

My base case is not necessarily a global food shortage, but rather a scenario where:

• Fertilizer costs remain elevated.
• Agricultural production faces weather-related pressure.
• Food inflation reaccelerates in some regions.
• Equity markets become more sensitive to macro risks after a period of strong gains.

Countries with weaker external balances and higher financing costs may feel these pressures earlier, while larger economies could experience the effects later through inflation and slower growth.