Weekly Market Snapshot

Global equities rebounded as easing U.S.-Iran tensions drove a sharp decline in oil prices, supporting a broad-based risk-on move across regions. A softer U.S. core inflation print and ECB rate hike reinforced global capital rotation into international equities. U.S. markets lagged amid technology sector pressure, with large AI-driven capital raises weighing on sentiment despite landmark developments such as the SpaceX IPO.

Weekly Market Movers — Key Highlights
  • U.S.–Iran developments triggered a global market rebound
  • Falling crude reshaped rate expectations and equity flows
  • AI boom vs dilution fears, drove divergence in mega-cap tech returns.
  • SpaceX’s $75B Record-Breaking IPO debuted this week.
  • Global Rotation, investors shifted from U.S. assets to Europe, Japan & EMs.

Global equity markets rose over the week, as a massive surge in international risk appetite outpaced the localized dilution pressures seen in Wall Street’s technology sector. Global equities benefited heavily from a sharp mid-week cooling of geopolitical tensions after President Trump announced an impending diplomatic breakthrough with Iran, causing Brent crude oil to decline and instantly erasing fears of a global energy shock. This oil correction, combined with a softer-than-feared 0.2% monthly U.S. Core CPI reading and a 25-basis-point interest rate hike by the European Central Bank to 2.25%, triggered a widespread global rotation out of the safe-haven U.S. dollar and into major European, Japanese, and emerging market equities, pushing the global benchmark into positive territory for the week..

In global geopolitics, President Trump announced an impending diplomatic agreement with Iran, successfully averting planned U.S. military strikes in Europe. This sudden de-escalation of Middle Eastern tensions caused Brent crude oil prices to decline. Escalating naval standoffs between China and Taiwan in the South China Sea, limited the upside for Asian semiconductor manufacturers, keeping supply chain anxieties elevated.

Global Updates
  • The MSCI All Country World Index declined earlier in the week as U.S.–Iran tensions lifted oil prices, and inflation rose to 4.2% in the U.S., and expectations of tighter monetary policy weighed on equities. However, by the end of the week, indications of a possible diplomatic resolution to the middle eastern conflicts led to a decline in energy prices and improved risk-on sentiment in global equity markets.
  • The European Central Bank raised its three key interest rates by 25 basis points, moving the core deposit facility rate to 2.25% while flagging persistent upside risks to regional inflation.
  • Japan’s corporate wholesale inflation accelerated to 6.3% year-on-year in May, hitting a three-year high due to energy supply spikes and consolidating expectations for a near-term Bank of Japan interest rate hike.
  • China’s Services Purchasing Managers’ Index increased to 54.5 in May from 52.6 in April.
  • The S&P Global Eurozone Services PMI rose marginally to 47.7 in May 2026 from the five-year low of 47.6 recorded in April.
  • In Canada, the unemployment rate declined to 6.6% in May 2026, down from 6.9% in April.
  • Net employment in Canada increased sharply by 87,800, significantly surpassing market expectations of 10,000.
  • Full-time employment in Canada rose by 154,000 in May 2026, reversing a decline of 47,000 recorded in the previous month.
  • AI model developer DeepSeek is reportedly close to completing a fundraising round of approximately USD 7 billion.
  • In Canada, support for Alberta separatism appears to be declining, with approximately 75% of residents opposing separation.
  • A U.S.–Iran memorandum to halt the Gulf conflict could be signed by Sunday in Geneva, though terms are unfinished and Iran insists it must also end fighting in Lebanon. Global crude oil benchmarks plunged significantly on Friday, retreating from multi-month highs near $100 per barrel as supply disruption fears across the Strait of Hormuz dissipated.
U.S. Equity
  • U.S. equities navigated a volatile week, marked by SpaceX’s record $75 billion IPO at a $1.77 trillion valuation and a macro backdrop supported by softer‑than‑expected core inflation and easing oil prices. However, sentiment within the technology sector remained bifurcated, as large-scale capital raises to fund AI infrastructure triggered sharp declines in select names, including Super Micro Computer and Oracle, amid dilution and leverage concerns. The broader U.S. equity market indices declined over the week weighed down by concerns of monetary tightening and decline in technology stocks.
  • The U.S. headline CPI for May rose to a three-year high of 4.2% due to a 23.5% spike in energy costs, sparking intense market fears that the Federal Reserve would be forced to aggressively raise interest rates. However, fears of monetary tightening subsided slightly, because the underlying Core CPI rose by a softer-than-expected 0.2% and crude oil prices subsequently declined on geopolitical breakthroughs.
  • The U.S. Producer Price Index (PPI) wholesale inflation reading for May rose 1.1% month-on-month and 6.5% year-on-year, exceeding market expectations.
  • The May Nonfarm Payrolls report exceeded expectations, with job gains of 172K and an additional 93K in upward revisions, underscoring continued strength in the U.S. labor market. The upside surprise prompted a sharp repricing in rate expectations, effectively pricing out near‑term Fed easing and pushing the benchmark 10‑year Treasury yield above 4.53% as markets adjusted to a prolonged higher‑for‑longer policy stance.
  • The Federal Reserve maintained its policy rate in the 3.50%–3.75% range while signaling persistent inflation risks, reinforcing market repricing toward potential rate hikes later in 2026.
  • SpaceX completed a record‑breaking initial public offering, issuing 555.6 million shares at $135 to raise $75 billion in proceeds. The Nasdaq debut values the aerospace, satellite, and AI company at approximately $1.77 trillion, marking the largest IPO globally and significantly elevating Elon Musk’s net worth.
  • OpenAI filed for an initial public offering with the SEC this week, signaling plans for a potential landmark listing that could command a valuation in the several hundred‑billion‑dollar range, underscoring sustained momentum in artificial intelligence markets.
  • Super Micro Computer shares declined sharply following the announcement of a $7 billion capital raise to fund AI infrastructure expansion, with the move triggering investor concerns around equity dilution and the escalating capital intensity of AI hardware growth.
  • Oracle shares declined following the announcement of a $40 billion debt and equity raise to fund AI infrastructure expansion, with the reaction reflecting investor concerns over potential dilution and increased leverage amid intensifying competition in the AI cloud segment despite earnings beat.
Fixed Income
  • The Bloomberg U.S. Aggregate Bond Index rose over the week.
  • The U.S. 10-year Treasury yield declined to 4.463% and the yield on the 2-year note declined to 07% over the wee due to collapsing crude oil prices following geopolitical breakthroughs with Iran and a softer-than-feared core CPI inflation report.
  • The U.S. Dollar Index declined slightly to 99.67 over the week due to the “risk-on” sentiment and expectations of monetary tightening.