Weekly Market Update (May 16, 2026)
HIGHLIGHTS
No tangible outcome after Trump-Xi meeting, and there is still no shared plan to reopen the Strait. Inflation remains a key focus, while long-end yields have jumped.
- Earnings: Strong earnings and sustained AI demand have supported the recent tech rally in the recent weeks. US tech stocks now account for a higher share of the index than at the 2000 peak.
- Obesity: The obesity market remains strong, driven by the rising GLP-1 adoption. New oral formulations have expanded patient access, while the competition are still manageable.
- AI: Consumer agentic AI remains in focus. Google announced upcoming AI features for Android, indicating the growing momentum in this area.
MARKETS
| Nasdaq | 26,225.15 | -0.08% |
| S&P 500 | 7,408.50 | +0.13% |
| Dow | 49,526.17 | -0.17% |
| 10-Year | 4.60% | +24bps |
| Brent | 109.26 | +7.87% |
| DXY | 99.27 | +1.46% |
*Data as of market close. 5-day change ending on Friday.
VIEW FROM THE STREET
Equity
Goldman Sachs: The equity market now is one big trade rather than a market of stocks. AI strength alone could lift the S&P 500 to new highs, despite narrow market breadth.
Standard Chartered: Equity markets continued to rally after the US–China meeting and strong corporate earnings. Although the medium-term outlook remains constructive, equities are less attractive than last month.
Fixed Income
Goldman Sachs: The inflation, growth and monetary policy mix is more favorable in the US than in Europe. We expect credit spreads in Europe to widen more than in the US.
UBS: Markets are overpricing the risk of rate hikes. This creates the opportunity to buy short-to-medium duration bonds.
Economy
Morgan Stanley: Given uncertainty in the Strait and rising inflation, the likelihood of rate cuts has declined. We expect higher term premiums and higher-for-longer long maturity rates.
J.P. Morgan: Reopening the Strait is important. Many countries have started using their strategic oil reserves. However, these reserves are not designed to eliminate an energy shock, but to provide a buffer during periods of disruption.