Highlights
Global markets navigated a week defined by the escalating US-Iran conflict and its cascading effects across asset classes, as fresh Strait of Hormuz clashes kept geopolitical risk firmly in the driving seat even as diplomatic efforts continued in the background. US equities powered to fresh highs, with the S&P 500 and Nasdaq extending their winning run to a sixth consecutive week — the longest streak since 2024 — buoyed by a blowout April jobs print, robust corporate earnings, and renewed AI optimism, while European stocks also advanced despite mounting energy supply concerns. In rates, US Treasury yields eased to two-week lows and UK gilt yields hit their softest level since April 20th, as a combination of geopolitical uncertainty, cautious Fed expectations, and UK political turbulence — with Labour suffering heavy losses to Reform UK — kept downward pressure on borrowing costs. In currencies, the dollar slipped to a ten-week low despite resilient labour data, caught between solid economic fundamentals and energy-driven inflation fears, while the Canadian dollar weakened further after an unexpected domestic job loss and a six-month high unemployment reading cemented Bank of Canada easing expectations. Commodities were sharply divided — crude shed over 6% to $95.42 per barrel as ceasefire doubts and a shuttered Strait of Hormuz sustained the energy supply shock, while silver surged 6.61% above $80 per ounce on peace deal optimism, rounding off a week in which diplomacy and escalation remained two sides of the same coin.
Data Highlights
USD Jobless Claims 4-week Average fell -216bps, from 207.75 to 203.25, -275bps less than the 209K expectation. USD Nonfarm Payrolls Private fell -3,784bps, from 185K to 115K, +8,548bps more than the lesser 62K expectation. CAD Unemployment Rate (Apr) rose +20bps, from 6.7% to 6.9%, +20bps more than the flat expectation of 6.7%. EUR PPI YoY (Mar) rose +510bps, from -3% to 2.1%, -30bps more than the expected 1.8%.
Week Ahead
GER Inflation Rate YoY (Apr), USD Inflation Rate YoY (Apr), USD Core Inflation Rate YoY (Apr) – Tuesday | EUR GDP Growth Rate YoY (Q1), USD PPI YoY (Apr), USD Core PPI YoY (Apr) – Wednesday | GDP YoY (Mar), GDP Growth Rate YoY (Q1), USD Continuing Jobless Claims (May/02), USD Initial Jobless Claims (May/09) – Thursday | JPY PPI YoY (Apr) – Friday |
