Market Quick Take – 29 May 2026

Market drivers and catalysts

• Equities: US records were led by AI infrastructure, Europe softened on geopolitics, Asia rebounded as ceasefire hopes lifted tech.
• Volatility: record highs, low VIX, upside skew
• Digital Assets: Bitcoin stabilising, ETF outflows
• Commodities: BCOM suffers monthly setback as crude and fuel prices tumble on ceasefire hopes; gold survives test of key support
• Fixed Income: US treasury yields fell Thursday, especially at longer end of the curve. Long-dated JGB’s rallied sharply Friday, sending yields lower.
• Currencies: USD weakens in line with crude oil price drop, price action sluggish. NZD and SEK strong.
• Macro: US April Trade & May CPIs from major European countries

Macro headlines

• The US side reports that the US and Iran have reportedly reached a tentative deal to extend a ceasefire by 60 days and launch further talks on Tehran’s nuclear program, raising hopes the three-month conflict could be nearing a resolution. The deal would allow unrestricted shipping through the strait without tolls or harassment. But as of Friday morning, nothing has been signed.
• US April PCE inflation rose 3.8% YoY, the highest since May 2023, driven by elevated energy costs. Core PCE came in at 0.2% MoM versus the 0.3% estimate, a modest positive surprise. Personal income was flat versus an expected 0.4% gain while spending rose 0.5%.
• US Q1 GDP was revised down to 1.6% annualised from the initial 2.0% estimate, below consensus expectations, driven by weaker consumer spending growth.
• Fed speakers struck a cautious but increasingly hawkish tone. St. Louis Fed's Musalem warned the real policy rate is below neutral, longer-term inflation expectations are drifting up, and a rate hike scenario exists if disinflation does not materialise within one to two quarters.
• The account of the ECB April meeting showed a number of officials saying that the decision to not hike was a close call and they would not have opposed a hike at that meeting. The accounts firmly point to a June 10-11 rate hike as priced by markets.
• Tokyo May CPI data out today saw across the board softer numbers than expected. The headline inflation came in at 1.4% YoY vs. 1.6% expected and 1.5% in April, while the ex-Fresh Food measure came in at 1.3% YoY vs. 1.5% expected and 1.5% in April and the ex-Fresh Food and Energy measure came in at 1.6% YoY vs. 1.8% expected and 1.9% YoY in April.

Macro calendar highlights (times in GMT)

• 0645 – France Flash May CPI
• 0700 – Spain Flash May CPI
• 0900 – Italy Flash May CPI
• 1200 – Germany Flash May CPI
• 1230 – US April Advance Goods Trade Balance
• 1345 – US May Chicago PMI

Fed speakers: Schmid (1050), Bowman (1310), Paulson (1315), Daly (1640)

Earnings events

• Thursday (yesterday): Dell Technologies, Autodesk, NetApp, Dollar Tree, Best Buy, Hormel Foods

Next week:

• Monday: Hewlett Packard Enterprise
• Tuesday: Palo Alto Networks, Dollar General, Ulta Beauty
• Wednesday: Broadcom, Inditex, CrowdStrike, Medtronic, Veeva Systems
• Thursday: Ciena, Lululemon Athletica

For all macro, earnings, and dividend events check Saxo’s calendar.

Equities

• USA: The S&P 500 rose 0.6% to 7,563.63, the Nasdaq Composite gained 0.9% to 26,917.47, and the Dow edged up less than 0.1% to 50,668.97 as US equities hit fresh records. The session was supported by lower oil stress, softer bond yields and another reminder that the AI infrastructure trade is still wearing comfortable shoes. Dell jumped 39.1% after hours after lifting its full-year revenue outlook and AI-server target, while Hewlett Packard Enterprise rose 26.3% and Super Micro Computer added almost 10.0% in sympathy. Agilent gained 16.9% after stronger results and guidance. Investors now watch whether AI demand turns into durable margins.
• Europe: The Stoxx 600 fell 0.5% to 625.11, the FTSE 100 dropped 0.8% to 10,425.96, the DAX lost 0.3% to 25,092.25, and the Euro Stoxx 50 slipped 0.3% to 6,055.11 as Middle East uncertainty kept risk appetite cautious. Losses eased from the lows after reports of progress on the US-Iran ceasefire, but financials and insurers weighed on the region. Soitec surged 24.6% after stronger sales expectations and better cash flow, helped by AI-related chip demand. Siemens Energy fell 4.4% on profit-taking after a strong run, while Dassault Systèmes dropped 5.7% as software sentiment stayed fragile. Markets now look to European inflation data and central bank signals.
• Asia: Asian markets traded higher on Friday as Wall Street records and hopes of a longer US-Iran ceasefire lifted sentiment. Japan’s Nikkei rose 1.8%, South Korea’s Kospi gained 2.3%, and Taiwan’s Taiex added 2.3%, while Australia’s ASX 200 rose 1.0%; Hong Kong’s Hang Seng advanced 0.4% and China’s Shanghai Composite slipped 0.2%. Tech led the move, with chip and server-linked names supported by Dell’s AI-server surprise and lower oil prices. Samsung Electronics rose 2.3% as South Korean investors bought the chip rebound. Lenovo extended a powerful weekly rally in Hong Kong on AI hardware optimism. The next test is whether ceasefire headlines can stay calm for more than one trading session.

Volatility

• Volatility remains remarkably contained despite a busy macro backdrop. The VIX closed at 15.74, down from 16.29 the previous session, while the S&P 500 advanced 0.58% to a fresh record close of 7,563.63. Markets continue to draw support from improving sentiment around a potential extension of the US-Iran ceasefire, which has helped ease pressure on oil prices and inflation expectations, although investors remain alert to economic data and geopolitical headlines.
• SPX expected move: Options markets are pricing an expected move of approximately ±34.6 points (±0.46%) for today's session. The day's 0DTE positioning shows a modest upside skew, with near-the-money calls attracting more demand than equivalent puts around the 7,565 strike. This suggests investors remain positioned for further gains, although the relatively low level of volatility leaves markets vulnerable to unexpected headlines.
• Today's key economic release is the Chicago PMI, while next week's calendar becomes considerably busier with earnings from Broadcom, CrowdStrike, Palo Alto Networks, Hewlett Packard Enterprise, Ulta Beauty and Lululemon, providing several potential catalysts for market sentiment.

Digital Assets

• Digital assets are attempting to stabilise after a volatile week driven by geopolitical uncertainty, higher oil prices and continued ETF outflows. Bitcoin trades around USD 73,586, while Ethereum holds near USD 2,011, both recovering from recent lows as broader risk sentiment improves. However, institutional demand remains mixed, with recent spot ETF flow data showing continued withdrawals from both Bitcoin and Ethereum products.
• Among crypto-linked ETFs, IBIT trades at USD 41.56 (-2.1%) and ETHA at USD 15.19 (-1.9%), reflecting the recent pressure on digital asset prices. Major altcoins are showing a more balanced picture, with XRP near USD 1.31, Solana around USD 82, and Ethereum outperforming slightly versus Bitcoin over the past 24 hours. Meanwhile, crypto-related equities are mixed, with Coinbase (+4.9%), Riot Platforms (+3.0%) and Circle (+5.5%) outperforming, while MicroStrategy (-1.7%) and Marathon Digital (-1.8%) remain under pressure.
• Options flow in crypto-linked names continues to show a defensive bias, with institutional investors maintaining downside hedges in several crypto proxies while selectively retaining upside exposure. The result is a market that appears cautious rather than outright bearish, with sentiment likely to remain highly sensitive to ETF flows, regulatory developments and the direction of Bitcoin.

Commodities

• The Bloomberg Commodity Total Return Index (BCOM) is heading for a monthly loss of around 3%, its first decline in five months. Hopes for a Middle East peace deal gathered momentum during the month, weighing heavily on energy prices and sending the BCOM Energy Index down more than 8%. The decline would have been even steeper had it not been for a strong 12% rebound in natural gas.
• Broad-based losses across the agriculture sector, led by corn, wheat, sugar, and livestock, also weighed on overall performance, more than offsetting a 5% gain in the BCOM Industrial Metals Index, where copper and zinc led advances. It was another challenging month for precious metals, with silver strength largely compensating for a decline in gold.
• Oil fell to a five-week low after the US and Iran tentatively agreed to extend their ceasefire by 60 days, with Brent heading for its biggest monthly decline since 2020 on expectations the agreement could pave the way for a gradual reopening of the Strait of Hormuz. While significant hurdles remain, the market is reacting to the prospect of a supply surge once hundreds of tankers loaded with crude oil and refined fuels are released from the Persian Gulf. In the months ahead, however, demand to replenish depleted global inventories is likely to provide support, potentially lifting the price floor compared with pre-war levels.
• Gold survived another attempt to break below its 200-day moving average, currently near USD 4,400, as technically driven short sellers were squeezed by improving prospects for a US-Iran deal. The easing of energy-driven inflation concerns helped push bond yields and the dollar lower, providing support to bullion. Having successfully tested this key support level twice during the conflict, gold remains caught in a challenging technical environment, with a break above USD 4,575 and ultimately the 50-day moving average at USD 4,628 needed to improve the near-term outlook.

Fixed Income

• US Treasuries rallied again Thursday after early weakness on the back and forth headlines over prospects for a significant ceasefire extension in the US-Iran war. The benchmark 2-year treasury yield retreated from intraday highs on Thursday of 4.08% to close near unchanged at 4.02%, where it also traded early Friday in early European hours. A similar pattern in the benchmark 10-year treasury yield, though with stronger buying demand late Thursday as the yield retreated from an intraday high of 4.53% to close down more than three basis points at 4.45%, dropping another basis point to 4.44% early Friday .
• Japan’s government bond yield curve flattened on strong demand for longer-dated JGB’s, as the benchmark 10-year JGB yield fell nearly five basis points to 2.655% and the 30-year fell more than five basis points to below 3.93%, eyeing its lowest close in more than two weeks.

Currencies

• The US dollar rally reversed on Thursday on renewed hopes for an extended ceasefire in the US-Iran war, which also sent crude oil prices lower. EURUSD rallied from below 1.1600 to as high as 1.1661, challenging the exact range high of late before retreating slightly. USDJPY retreated from its highest levels in weeks at 159.65 at one point Thursday to trade near 159.30 by early Friday.
• The improved risk sentiment outlook in recent days has boosted the traditionally more pro-cyclical Swedish krone within Europe, sending EURSEK lower to below 10.77 after its challenge of 11.00 last week. The next focus is the range low from mid-April just below 10.75.
• The AUDNZD selloff extended again Thursday and early Friday as AUDNZD finds itself at 1.2025, down more than 40 pips from the Thursday close and possibly set to challenge the psychologically important 1.2000 level. The recent deceleration in the policy tightening outlook from the RBA relative to the RBNZ’s newfound hawkishness has helped drive the recent dramatic repricing lower of this pair. A strong rebound in the ANZ Activity Outlook and Business Confidence survey early Friday also boosted the kiwi.

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