Weekly Market Update: Trump China trip has pomp but not much ‘circumstance’; Bond yields flash warning signs amid more hot inflation readings
the S&P 500 topped 7500 for the first time, despite hot inflation readings and resurgent energy prices. Late season earnings reports continued to highlight unprecedented demand coming from the AI revolution which once again fueled exuberance for equities. Breadth remained very narrow though, and many investors noted the frothy action harkened back to late 1990s. The posterchild was the IPO of Cerebras which opened at more than 230x sales on Wednesday. The jubilation came in the face of some darkening clouds on the horizon. UK Gilt yields jumped amid rising uncertainty around the fate of PM Starmer and his cabinet. The 30-year JGB bond yield climbed to 4.00% for the first time since 1999 amid talk of an extraordinary budget and a hot inflation print. The US 2-year yield established a foothold above 4% and the 10-year above 4.5% and futures markets moved to price in more than a 50% chance of a 25 bps hike by the end of the year. All three of this week’s US Treasury auctions tailed amid mediocre demand. Monday data showed US April CPI accelerated broadly, with inflation outpacing wage growth for the first time in three years, probably to the chagrin of Kevin Warsh who will take the helm at the Fed next week.
On Friday, investor risk appetite dwindled as the Trump-Xi summit wrapped up. The early consensus read was despite all the fanfare and platitudes on display throughout the visit, not much was actually agreed upon by the two leaders. Taiwan clearly remains a very thorny and delicate issue while the Iran situation potentially complicates things further. Energy prices rose broadly, led by crude oil, perhaps on the expectation Trump will again turn his focus back to the Middle East conflict given Tehran’s ongoing intransigence regarding the Strait and its nuclear ambitions. Satellite maps showed ships in the both the Persian Gulf and Gulf of Oman appearing to congregate closer to southern shores away from mainland Iran, while Israeli press reports noted the government was readying itself for a possible restart of the war. Brent moved back up towards $110/barrel. For the week, the S&P gained 0.1%, the DJIA slipped 0.2%, and the Nasdaq edged down 0.1%.
Corporate news continued to revolve largely around AI, as usual, with Cisco Systems keeping trade buoyant with a strong Q3 result and raised guidance as it nearly doubled expected 2026 orders from hyperscalers. The Cerebras IPO also brought billions of new capital into the market, as the potential “Nvidia killer” gave IPO investors everything they could have hoped for, opening at nearly twice the already padded $185/share pricing. Nvidia itself – certainly not dead yet – continued to pace a narrow group of tech shares higher as its vaunted CEO dramatically joined the Trump entourage during an Air Force One refueling stop in Alaska. The Beijing trip didn’t yield much in results for the tech giant, however, as reports said Chinese firms still aren’t biting on its dumbed down N200 chips despite getting limited clearance for sales from the US Administration. Meanwhile the market for workaday memory and logic chips may get even tighter as Samsung was unable to reach a new labor contract with its union, which has threatened a prolonged strike action that could significantly crimp supply chains for all sorts of manufacturers. The broader tech trade also got more exciting news on Friday as reports circulated that the trillion dollar plus SpaceX IPO will come sooner than expected, by mid-June.
MON 05-11
(KR) South Korea Policy Chief Kim: AI citizen dividend will be from excess tax [income]; AI dividend does not mean windfall tax; South Korea should pay citizens a “dividend” using taxes on AI profits - Responding to US financial press query
(IR) US Energy Sec Wright: Trump administration is “open to all ideas” to lower the cost of gas, including suspending the federal gas tax - NBC News (update)
(IR) Iran News Agency Tasnim reports Iran has deployed deep-roaming submarines in Strait of Hormuz - press
(US) Israel PM Netanyahu: Iran war is "not over" until highly enriched uranium is removed; Israel underestimated Iran's ability to close the Strait of Hormuz - 60 Minutes interview (update)
(US) House lawmakers said to introduce bill banning Chinese vehicles in US - press
(US) TREASURY'S $58B 3-YEAR NOTE AUCTION RESULTS: DRAWS 3.965% V 3.897% PRIOR; BTC 2.54 V 2.68 PRIOR AND 2.62 OVER THE LAST 9 AUCTIONS
TTN Research Alert: Mid-May update to our Hormuz real failure map from last month; The late-April alert described “interface fragility.” The mid-May version needs a sharper phrase: exception-making capacity
011170.KR TTN 03:00 ET Call Summary: Q2 performance improvement is expected to continue “for the time being,” helped by temporarily tight feedstock/product supply, but management warned that high naphtha purchased after the late-February Middle East war will begin flowing into production costs in Q2, creating a potential negative lag effect.
AIQ TTN Research Alert: Why hallucination-adjusted intelligence will matter more than raw capability in the next phase of AI; The most dangerous AI models are not the weak ones, but the ones smart enough to be believed when they are wrong
ARAMCO.SA *CEO: Iran war could disrupt oil until 2027; “If trade and shipping remain curtailed by more than a few weeks from today, we anticipate the supply disruption to persist, and the market to normalize only in 2027” - London Times [update]
ARAMCO.SA TTN 08:00 ET Call Summary: Demand remains healthy into H2 26; Can reach maximum sustainable capacity of 12MMbpd in less than three weeks if required; management said reduced production at some fields can be restored to prior levels “within days.”; Looking at additional measures to strengthen resilience in mid-to-long term
BABA Said to to integrate Qwen AI with Taobao, launch agentic shopping - press (update)
CE Increases prices for a range of acetyl products, effective immediately
FSK Reports Q1 $0.41 v $0.44e; Notes impact of market-driven spread widening in certain segments of its portfolio; Cuts again quarterly dividend 12.5% to $0.42 from $0.48 (indicated yield 15.34%); Announces $300M share buyback
MNDY Reports Q1 $1.15 v $0.96e, Rev $351.3M v $339Me
MOS Reports Q1 $0.05 adj v $0.20e, Rev $3.00B v $2.75Be; Notes higher risk of negative yield impacts around the world; Phosphate production plan in the US and Brazil is under review as a result of raw material constraints; Partial curtailments to begin in May
RSX TTN Research Alert: Behind Putin’s Victory Day statement that the Ukraine conflict is heading towards completion lies the same uncompromising position: continued military victory, full territorial control, and only symbolic ceasefire gestures.
TUES 05-12
(DE) GERMANY MAY ZEW CURRENT SITUATION SURVEY: -77.8 V -78.0E
(DE) ECB's Nagel (Germany): ECB rate hikes are becoming increasingly likely; We still have quite a bit of inflation ahead of us; We're no longer in the baseline scenario and moving toward the adverse scenario
(IR) IRGC Navy deputy official: Iran's operational zone for the Strait of Hormuz has been significantly expanded beyond its traditional limits around islands like Hormuz and Hengam to a broader strategic area reaching Jask, Siri, and beyond.
(IR) EIA: Iran war related oil production shut ins will peak at about 10.8M bpd in May; Production patterns to normalize only by late 2026 at the earliest
(IR) Iranian Parliamentary Commission spokesperson Rezaei: One of Iran’s responses in the event of another US-Israeli attack on its territory “could be 90% enrichment”. (update)
(IR) Reportedly UAE Adnoc Gas's biggest gas plant from Iranian attacks last month will not be fully repaired until next year - FT (update)
RSX TTN Research Alert: Behind Putin’s Victory Day statement that the Ukraine conflict is heading towards completion lies the same uncompromising position: continued military victory, full territorial control, and only symbolic ceasefire gestures.
(US) Apr Federal Budget balance: $215B v $220Be (update)
(US) ADP Preliminary Employment Change for 4-weeks ending Apr 25th: +33.0K v +30.3K prior
(US) Atlanta Apr Sticky-CPI (1-month annualized) 4.6% v 2.4% m/m; Core Sticky CPI (1-month annualized) 4.8% v 2.4% m/m (update)
(US) TREASURY'S $42B 10-YEAR NOTE AUCTION DRAWS 4.468% V 4.177% PRIOR; BID-TO-COVER RATIO: 2.40 V 2.39 PRIOR AND 2.48 OVER LAST 4 AUCTIONS
005930.KR *(KR) South Korea PM convenes an emergency cabinet meeting regarding Samsung union strike - Media
7011.JP CEO: Global orders for gas turbines will “decline slightly” this year from 2025, but remain strong due to the build-out of data centers - earnings call (update)
AMZN Plans to expand its 30-min delivery Amazon Now to tens of millions of customers by end-2026; Small-order fees apply below $15
CME Launches first compute futures; Later this year pending regulatory review
JD TTN 08:00 ET Call Summary: The round of price increases in electronics is sharp and widespread; Management flagged near-term headwinds from a high trade-in base and rising electronics product prices, but said JD’s supply-chain model continues to help navigate market cycles and sustain upward performance.
JJG TTN Research Alert: A Polycrisis in the Fields; Phosphate production bottlenecks, crop-protection shortages, and multiplicative yield risks that could slash maize and wheat harvests by double-digit percentages in 2026-27.
NVDA *(CN) CEO Huang said to now join US Pres Trump trip to China, despite not receiving White House invitation [this is contrary to prior reports] – Semafor
NVO Higher dose Wegovy demonstrates nearly 28% weight loss in early responders according to new analyses presented at the European Congress on Obesity; Separate analysis showed 84% of weight loss with Wegovy was from fat mass, abdominal visceral fat fell over 30%, and muscle function was preserved.
TKA.DE Reports Q2 Net -€64M v +€155M y/y, adj EBIT €198M v €19M y/y, Rev €8.38B v €8.58B y/y; Trims Rev outlook citing steel and automotive weakness weigh on results
UA Reports Q4 -$0.03 v -$0.03e, Rev $1.17B v $1.17Be; Guides initial FY26 poorly, even assuming refunds from prior year IEEPA tariff expenses are realized
VOD.UK Reports FY26 Net -€49M v -€3.75B y/y, EBITDAaL €11.4B v €10.9B y/y, Rev €40.5B v €37.4B
WED 05-13
(CN) Trump-Xi Summit at the Great Hall of the People (Beijing); Greeting, Bilateral Meeting
(RU) Reportedly Russia’s top commanders have convinced Pres Putin their forces could seize the whole of the Donbas by autumn; Putin then plans to raise the price of any ceasefire by escalating Russia’s territorial demands - FT
(US) DOE CRUDE: -4.3M V -2.0ME; GASOLINE: -4.1M V -3.0ME; DISTILLATE: +0.2M V -3.0ME
(US) TREASURY $25B 30-YEAR BOND REOPENING DRAWS 5.046% V 4.750% PRIOR; BID TO COVER 2.30 V 2.66 PRIOR AND 2.42 OVER LAST 8 REOPENINGS
(US) US Senate confirms Kevin Warsh to Fed Chair post; Vote was 54-45
IEA MONTHLY OIL REPORT (OMR): Global oil supply to plunge below demand this year on Iran war; Warns of further price spikes as global oil inventories fall at record pace
1211.HK Said to be in talks with Stellantis and others to take over EU car plants – press
ALO.FR Reports final FY25 Net €324M v €149M y/y, EBIT €1.17B v €1.18B y/y, Rev €19.17B v €19.11Be
BABA Reports Q4 $0.09 (unclear of comp) v $1.22e, Rev $35.3B v $35.2Be
CF TTN Summary Call: CF said the industry is shifting toward the U.S. as the “safe place” to produce nitrogen because of low-cost gas, rule of law and access to farmland, a direct strategic tailwind for the company’s North American assets.
CSCO Reports Q3 $1.06 v $1.04e, Rev $15.8B v $15.5Be; Raises outlook
EOAN.DE Reports Q1 Adj Net €1.34B v €1.27B y/y, adj EBITDA €3.25B v €3.23B y/y, Rev €21.8B v €25.2B y/y
NBIS Announcing new second owned giga watt-scale site in the US — in Pennsylvania, with up to 1.2 GW of power.
OLA.CA To be acquired by Equinox Gold Corp. in an at-market combination; creates $18.5B North American senior gold producer; Orla shareholders receiving 1.00 Equinox share and $0.0001 for each Orla share.
RWE.DE *TTN 04:00 ET Call Summary: Middle East / Strait of Hormuz disruption is expected to keep upward pressure on oil and gas prices: management said every day Hormuz remains closed physically removes molecules from the market, and even a peace deal would not normalize supply chains immediately; refineries and logistics could take “several months to a year” to stabilize.
SIE.DE Reports Q2 Net €2.24B v €2.44B y/y, Rev €19.8B v €20.1Be; Announces up to €6B share buyback for up to 5 years
TUI1.DE CEO: Do not expect jet fuel scarcity
WCH.DE Raising prices by up to 15% due to raw material costs for resins, dispersions, and dispersible polymer powders, effective June 1st, 2026
THRS 05-14
(CN) China Pres Xi meets with US business leaders; Reiterates China's doors will open more - China state media
(CN) US Pres Trump: Confirms China wants to buy oil from US; Going to start sending Chinese ships to Texas, Louisiana, Alaska; China going to be buying a lot of farm product - Fox News Interview
(CN) US USTR Greer: We expect agreement for double-digit billions of dollars of agriculture sales to China coming out of the Summit; Certainly seen rare earths come back to 'better levels' - comments from Trump-Xi Summit in Beijing
(JP) BOJ Official: Prices saw for wide range of goods centering on oil, chemical products due to uncertainty surrounding Middle East conflict, effective closure of Strait of Hormuz - comments on Apr PPI data
(US) BOFA INSTITUTE: WEEK-TO-MAY 2ND TOTAL CARD SPENDING +7.1% V +2.7% Y/Y PRIOR WEEK V +4.8% Y/Y DURING APRIL; Ex-gas spending rose by 5.8% y/y. Some of this was likely due to the impact of Mother's Day (5/10/26 vs 5/11/25).
(US) INITIAL JOBLESS CLAIMS: 211K V 205KE; CONTINUING CLAIMS: 1.782M V 1.780ME
(US) US Sec of State Rubio: US not asking China for help with Hormuz
(US) US Sec of State Rubio: China's preference is probably to get Taiwan willingly - NBC Interview
(US) WEEKLY EIA NATURAL GAS INVENTORIES: +85 BCF VS. +84 BCF TO +86 BCF INDICATED RANGE
(US) Pres Trump: Talks with Xi were great; China is beautiful - follow up comments with China's Pres Xi
AAPL Apple and OpenAI partnership said to fray, setting up possible legal battle; Deal failed to meet OpenAI's financial expectations – press
CBRS IPO opens for trade at $350 (priced at $185/shr)
GOOG Prices ¥576.5B in multi-tranche bonds [Biggest yen-denominated bond on record by foreign issuer]
NVDA *US SAID TO CLEAR H200 SALES TO 10 CHINA FIRMS, BUT NO DELIVERIES HAVE BEEN MADE SO FAR - PRESS [**Note: the press piece apparently talking about past approvals, not something what came out from Trump-Xi meetings in Beijing]
SPY TTN Research Alert: In the intricate machinery of US fiscal plumbing, the recent sharp contraction of the Treasury General Account (TGA) stands as one of the more understated forces behind the equity advance of spring 2026.
FRI 05-15
(US) Pres. Trump: Talked with China Pres Xi a lot about Taiwan and Iran; I made no commitment on Taiwan - comments from AirForceOne
(US) APR INDUSTRIAL PRODUCTION M/M: 0.7% V 0.3%E
(US) MAY EMPIRE MANUFACTURING: 19.6 V 7.2E; Prices Paid: 62.6 v 51.0 prior
(US) Tier1 analysts: In a market that was already benefiting from the removal of illegal capacity, Supreme Court ruling that federal law does not preempt state tort liability against brokers for negligent selection of trucking companies throws 'propane tanks' onto the fire
ADNOC.IPO Chairman: Reviewing progress on the new West-East Pipeline project, which is set to double ADNOC’s export capacity via Fujairah and scheduled to operate in 2027
OPENAI.IPO *CFO Friar: May raise more capital; Future fundraising will depend on demand, revenue growth, cash flow and the gap between the computing power OpenAI needs and what it can afford - US financial press [update]
SPACEX.IPO Reportedly has chosen NASDAQ as listing venue for IPO; To trade under ticker 'SPCX' and price as early as Jun 11th with listing on Jun 12th