fix: use async iteration for Modal stdout

src/policyengine_api/api/agent.py

@@ -172,39 +172,27 @@ async def _stream_modal_sandbox(question: str, api_base_url: str):
             )
             logfire.info("sandbox_created")
 
-            # Read stdout synchronously in executor, yield lines as we get them
-            def read_next_line(stdout_iter):
-                try:
-                    return next(stdout_iter)
-                except StopIteration:
-                    return None
-
-            stdout_iter = iter(process.stdout)
+            # Use Modal's async iteration for stdout
             lines_received = 0
             events_sent = 0
 
-            while True:
-                line = await loop.run_in_executor(executor, read_next_line, stdout_iter)
-
-                if line is None:
-                    # stdout exhausted
-                    logfire.info("stdout_exhausted", total_lines=lines_received)
-                    break
-
+            # Modal StreamReader supports async iteration
+            async for line in process.stdout:
                 lines_received += 1
                 logfire.info(
                     "raw_line",
                     line_num=lines_received,
-                    line_len=len(line),
-                    line_preview=line[:300].replace("session", "sess1on"),
+                    line_len=len(line) if line else 0,
+                    line_preview=line[:300].replace("session", "sess1on")
+                    if line
+                    else None,
                 )
-
                 parsed = _parse_claude_stream_event(line)
                 if parsed:
                     events_sent += 1
                     yield f"data: {json.dumps(parsed)}\n\n"
 
-            # Wait for process to finish
+            # Wait for process
             returncode = await loop.run_in_executor(executor, process.wait)
             logfire.info(
                 "complete",