Weekly Market Update (May 30, 2026)
HIGHLIGHTS
Markets expect a US-Iran deal to be imminent. With expectations of the Strait reopening, incoming activity and inflation data are beginning to reflect the energy price shock.
- China: Property sales weakened in May, highlighting the challenge of the destocking cycle. Consumption data are also weak, especially auto sales. Exports continue to be strong.
- UK: The Governor mentioned that they will tolerate a near-term inflation overshoot as long as it is unlikely to have longer-term effects. Data show no sign of direct or indirect inflationary effects so far.
- IPO: IPO activity is strong this year. 40 deals worth $28 billion have launched since the start of the year. Although deal sizes are larger, the number of deals is only on pace to reach the historical annual average of 100, compared with 250 in 2021 and about 400 in 1999.
MARKETS
| Nasdaq | 26,972.62 | +2.39% |
| S&P 500 | 7,580.06 | +1.43% |
| Dow | 51,032.46 | +0.90% |
| 10-Year | 4.45% | -10bps |
| Brent | 91.12 | -9.07% |
| DXY | 98.94 | -0.38% |
*Data as of market close. 5-day change ending on Friday.
VIEW FROM THE STREET
Equity
Goldman Sachs: We expect the recent IPO activity to create $500 billion of additional unlocked shares available for sale in 2026, and even more in 2027. On the demand side, companies continue to focus on capex spending instead of corporate buybacks.
Morgan Stanley: Although tech sector earnings continue to grow, free cash flow is declining as capex becomes increasingly important.
Fixed Income
J.P. Morgan: Rate cuts were the base case in 2026 before the Iran war. Today, markets are pricing in a full rate hike by March 2027. Markets are more concerned about inflation risks than growth risks driven by energy prices.
UBS: The correlation between 2Y US treasury yields and gold prices has reversed from positive to negative. Markets are focusing on opportunity costs, so gold as a non-yielding asset has become an important consideration.
Economy
UBS: Policymakers are monitoring elevated energy prices closely after the Iran war. The ECB is likely to hike rates in the coming months, while the Fed is likely to resume rate cuts at the end of 2026.
Standard Chartered: The Fed is likely to stay on hold as inflation has not broadened yet. Personal consumption expenditure has lost monthly momentum. Inflation is driven mainly by IT-related goods and energy prices, with minimal spillover so far.