Weekly Global Market Update

Global equities reached record highs on hopes of a US-Iran ceasefire, even as negotiations over the Strait of Hormuz remain bumpy. Easing US core inflation has lowered yields, but fiscal debt concerns continue to support a bullish outlook for gold.

Key Takeaways

• 1.Optimism regarding a potential US-Iran deal has driven global equities to record highs, with markets specifically watching for the reopening of the Strait of Hormuz.
• 2.US inflation data (Core PCE) was lower than expected, providing temporary relief, though investors await May jobs data and ISM surveys to evaluate wage-price spiral risks.
• 3.Rising government debt burdens, exacerbated by the conflict, are pressuring long-duration bonds; UBS favors gold and short-to-medium duration bonds as a result.

Table of Contents

• What to watch in the week ahead
• Will talks between the US and Iran lead to a reopening of the Strait of Hormuz?
• Iran latest developments and geopolitics
• Fixed income and upcoming central bank commentary
• Government debt and gold
• Will central bankers and economic data dampen rate-hike fears?
• Will worries over rising government debt burdens remain contained?
• Chart of the week

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