Weekly Market Pulse - Week ending May 15, 2026
Market developments
Equities: Global equity markets closed the week on a sour note after a strong mid-week rally, driven largely by AI and semiconductor stocks, ending with rising bond yields and geopolitical disappointment. The FTSE 100 was among the hardest hit, plunging over 1.5% on Friday alone. This marks its worst single-day drop since the early weeks of the Iran war, as U.K. political uncertainty surrounding Andy Burnham's leadership push compounded the global risk-off mood. A key catalyst for the late-week selloff was President Trump returning from China without a breakthrough on reopening the Strait of Hormuz, dashing hopes that had partly underpinned the earlier rally.
Fixed Income: Government bond markets experienced a significant global selloff, with yields surging to multi-decade highs across major economies. The U.S. 30-year Treasury yield topped 5.1%, its highest level since May 2025, while the 10-year yield broke above 4.59%, the highest intraday print since May 2025. The selloff was attributed to a combination of hotter-than-expected US inflation data, persistently elevated oil prices stoking rate-hike fears and broader fiscal concerns.
Commodities: Oil dominated the commodity narrative this week, with Brent crude climbing to $109 per barrel as the ongoing disruption to Middle East supplies from the Iran conflict intensified. The IEA warned that global oil inventories are falling at a record pace and will continue to drop for months.
Performance (price return)
SECURITY |
PRICE |
WEEK |
1 MONTH |
3 MONTH |
YTD |
Equities ($Local) |
|
|
|
|
|
S&P/TSX Composite |
33,833.35 |
-0.72% |
-0.94% |
2.30% |
6.69% |
S&P 500 |
7,408.50 |
0.13% |
5.49% |
8.37% |
8.22% |
NASDAQ |
26,225.14 |
-0.08% |
9.20% |
16.31% |
12.84% |
DAX |
23,950.57 |
-1.59% |
-0.48% |
-3.87% |
-2.20% |
NIKKEI 225 |
61,409.29 |
-2.08% |
5.63% |
7.85% |
21.99% |
Shanghai Composite |
4,135.39 |
-1.07% |
2.69% |
1.31% |
4.20% |
Fixed Income |
|
|
|
|
|
Canada Aggregate Bond |
242.10 |
-0.46% |
-0.03% |
-1.07% |
0.49% |
US Aggregate Bond |
2346.88 |
-0.52% |
-0.68% |
-1.35% |
-0.08% |
Europe Aggregate Bond |
245.31 |
-0.83% |
-0.38% |
-1.89% |
-0.60% |
US High Yield Bond |
29.50 |
-0.14% |
0.00% |
0.50% |
1.23% |
Commodities |
|
|
|
|
|
Oil |
105.78 |
10.86% |
15.87% |
68.20% |
84.22% |
Gold |
4537.28 |
-3.77% |
-5.30% |
-10.01% |
5.04% |
Copper |
624.25 |
-0.10% |
2.59% |
7.57% |
9.86% |
Currencies |
|
|
|
|
|
US Dollar Index |
99.31 |
1.44% |
1.28% |
2.47% |
1.00% |
Bitcoin (CAD) |
108,880.91 |
-0.66% |
5.75% |
16.03% |
-9.25% |
Loonie |
1.3757 |
-0.58% |
-0.12% |
-1.02% |
-0.24% |
Euro |
0.8604 |
-1.39% |
-1.50% |
-2.07% |
-1.05% |
Yen |
158.77 |
-1.32% |
0.14% |
-3.82% |
-1.30% |
Source: Bloomberg, as of May 15, 2026
Central Bank Interest Rates
Central Bank |
Current Rate |
June 2026 |
Bank of Canada |
2.25% |
2.29% |
U.S. Federal Reserve |
3.75% |
3.63% |
European Central Bank |
2.00% |
2.16% |
Bank of England |
3.75% |
3.82% |
Bank of Japan |
0.75% |
0.93% |
Source: Bloomberg, as of May 15, 2026
*Expected rates are based on bond futures pricing
Macro developments
Canada – No Notable Releases
No notable releases this week.
U.S. – Inflation Pressures Intensify, Producer Prices Surge on Energy Shock
Inflation in the U.S. rose to 3.8% in April 2026, exceeding expectations as energy costs surged due to the Iran conflict. Gasoline and fuel oil drove much of the increase, while shelter and food prices also edged higher. Monthly inflation slowed to 0.6%, though core inflation climbed to 2.8%, with underlying price pressures continuing to build.
Producer prices in the U.S. jumped 1.4% month-over-month in April, the largest increase in over four years, fuelled by a sharp rise in energy costs. Goods prices surged, particularly gasoline, while services also saw strong gains across several sectors. On a yearly basis, producer inflation reached 6%, signalling broad and intensifying cost pressures.
International – Eurozone Growth Stalls Amid Energy Constraints, Japan Producer Inflation Accelerates Sharply, China Inflation Edges Higher with Mixed Drivers
Economic growth in the Eurozone slowed to 0.1% in Q1 2026, the weakest pace in nearly a year, as energy supply disruptions weighed on activity. Major economies showed mixed performance, with France stalling while Spain led growth. Annual growth also decelerated and rising inflation risks are prompting consideration of further rate hikes by policymakers.
Japan’s producer prices rose 4.9% year-over-year in April, driven by strong energy-related cost pressures linked to global supply disruptions. Price increases were widespread across industries, particularly chemicals and petroleum products. Monthly producer inflation reached its highest level in over a decade, highlighting accelerating input cost pressures.
China’s inflation rose to 1.2% in April 2026, supported by higher transport and non-food prices amid rising energy costs. However, food prices declined, led by weaker pork and fresh produce costs, offsetting some inflationary pressure. Core inflation increased modestly, while monthly CPI rebounded, indicating a gradual pickup in price momentum.
Quick look ahead
DATE |
COUNTRY / REGION |
EVENT |
|
SURVEY |
PRIOR |
17-May-26 |
China |
Retail Sales YoY |
Apr |
2.00 |
1.7 |
17-May-26 |
China |
Retail Sales YTD YoY |
Apr |
|
2.4 |
18-May-26 |
Japan |
GDP Annualized SA QoQ |
1Q P |
1.67 |
1.3 |
18-May-26 |
Japan |
GDP SA QoQ |
1Q P |
0.40 |
0.3 |
18-May-26 |
Japan |
GDP Nominal SA QoQ |
1Q P |
0.80 |
0.9 |
18-May-26 |
Japan |
GDP Deflator YoY |
1Q P |
3.10 |
3.4 |
19-May-26 |
United Kingdom |
ILO Unemployment Rate 3Mths |
Mar |
4.80 |
4.9 |
19-May-26 |
Canada |
CPI NSA MoM |
Apr |
0.60 |
0.9 |
19-May-26 |
Canada |
CPI YoY |
Apr |
3.10 |
2.4 |
19-May-26 |
China |
1-Year Loan Prime Rate |
|
3.00 |
3.0 |
19-May-26 |
China |
5-Year Loan Prime Rate |
|
3.50 |
3.5 |
20-May-26 |
United Kingdom |
CPI MoM |
Apr |
0.90 |
0.7 |
20-May-26 |
United Kingdom |
CPI YoY |
Apr |
3.00 |
3.3 |
20-May-26 |
United Kingdom |
CPI Core YoY |
Apr |
2.65 |
3.1 |
20-May-26 |
Japan |
S&P Global Japan PMI Composite |
May P |
|
52.2 |
20-May-26 |
Japan |
S&P Global Japan PMI Mfg |
May P |
|
55.1 |
20-May-26 |
Japan |
S&P Global Japan PMI Services |
May P |
|
51.0 |
21-May-26 |
Eurozone Aggregate |
S&P Global Eurozone Manufacturing PMI |
May P |
51.80 |
52.2 |
21-May-26 |
Eurozone Aggregate |
S&P Global Eurozone Services PMI |
May P |
47.70 |
47.6 |
21-May-26 |
Eurozone Aggregate |
S&P Global Eurozone Composite PMI |
May P |
48.70 |
48.8 |
21-May-26 |
United Kingdom |
S&P Global UK Manufacturing PMI |
May P |
53.00 |
53.7 |
21-May-26 |
United Kingdom |
S&P Global UK Services PMI |
May P |
51.70 |
52.7 |
21-May-26 |
United Kingdom |
S&P Global UK Composite PMI |
May P |
51.60 |
52.6 |
21-May-26 |
United States |
S&P Global US Manufacturing PMI |
May P |
53.60 |
54.5 |
21-May-26 |
United States |
S&P Global US Services PMI |
May P |
51.25 |
51.0 |
21-May-26 |
United States |
S&P Global US Composite PMI |
May P |
|
51.7 |
22-May-26 |
Canada |
Retail Sales MoM |
Mar |
0.60 |
0.7 |
22-May-26 |
Canada |
Retail Sales Ex Auto MoM |
Mar |
0.85 |
0.5 |
P = Preliminary
The Asset Allocation Team at NEI Investments
Judith Chan, CFA – Vice President, Head of Asset Allocation
Mateo Marks, CFA – Director, Asset Allocation
Adam Ludwick, CFA – Director, Asset Allocation
Anthony Rago, B.A.Sc. – Senior Asset Allocation Analyst