[BUG] Thinking indicator and collapsed blocks not displayed in UI (regression in 2.0.64)

Preflight Checklist

• [x] I have searched existing issues and this hasn't been reported yet
• [x] This is a single bug report (please file separate reports for different bugs)
• [x] I am using the latest version of Claude Code

What's Wrong?

In version 2.0.64, the thinking indicator ("∴ Thinking…") and collapsed thinking blocks are no longer displayed in the terminal UI. This is a regression - both were visible in version 2.0.62.

What Should Happen?

Expected behavior

• "∴ Thinking…" indicator should appear while Claude is thinking (as in v2.0.62)
• Collapsed thinking block should be visible after response completes (as in v2.0.62)

Error Messages/Logs

Steps to Reproduce

To reproduce

1. Install Claude Code v2.0.64
2. Start a new session with claude
3. Enable thinking mode (Tab) or have alwaysThinkingEnabled: true in settings
4. Send any message that triggers thinking
5. Observe: No "∴ Thinking…" indicator appears, and no collapsed thinking block is shown after response

Claude Model

Opus

Is this a regression?

Yes, this worked in a previous version

Last Working Version

2.0.62

Claude Code Version

2.0.64

Platform

Anthropic API

Operating System

macOS

Terminal/Shell

Terminal.app (macOS)

Additional Information

it doesn't work on terminal.app and warp terminal

Workaround

Downgrade to v2.0.62:
npm i -g @anthropic-ai/claude-code@2.0.62