Zylostar Market Wrap – May 21, 2026
Global markets remained cautious as investors monitored developments surrounding a potential US-Iran agreement to reopen the Strait of Hormuz, while elevated oil prices and slowing economic activity continued to pressure sentiment across equities and bonds. The US dollar traded relatively flat, while Treasuries gained alongside global government bonds ahead of key US economic data releases and speeches from Federal Reserve officials later today.
Oil prices moved higher again, with Brent crude climbing above $107 per barrel after Iran’s Supreme Leader reiterated that uranium production must remain inside the country, reducing optimism surrounding a near-term agreement. The International Energy Agency’s Chief Fatih Birol warned that it may take considerable time for Middle Eastern oil production and refining capacity to recover to levels seen before the recent escalation, reinforcing concerns over long-term energy supply disruptions.
US equity futures weakened after Nvidia’s latest earnings report failed to reignite momentum in the AI-driven rally. S&P 500 futures fell 0.4% as investors became increasingly selective toward technology stocks despite Nvidia highlighting efforts to diversify revenue streams beyond major data-center clients. Markets are also assessing whether the rapid expansion in AI-related valuations can continue amid rising macroeconomic and geopolitical risks.
Economic data across Europe pointed to slowing growth momentum. Business activity in the Eurozone contracted at its fastest pace in two and a half years, while both German and French manufacturing PMI figures missed expectations. In the UK, businesses reported their first contraction in output in nearly a year as rising energy costs and growing political uncertainty weighed on confidence.
Meanwhile, central banks remained in focus. The Bank of Japan signaled internal division over the future pace of reducing bond purchases as yields remain near multiyear highs. JPMorgan CEO Jamie Dimon also warned that interest rates could rise significantly further from current levels, keeping pressure on global fixed-income markets.
On the corporate side, Walmart reported mixed but resilient quarterly results, posting adjusted EPS in line with expectations at $0.66 while revenue exceeded forecasts at $177.5 billion. Sam’s Club comparable sales also beat estimates, reflecting continued strength in consumer spending despite broader economic uncertainty.
By Amir Amidian
Senior Market Analyst | Zylostar
Middle East tensions and uncertainty around the Strait of Hormuz continue to raise concerns over global energy supply disruptions.
Investors were looking for stronger momentum to extend the AI rally, but cautious sentiment and high valuations limited optimism.
Weak PMI data from Germany, France, and the Eurozone signaled slowing economic activity and weaker business confidence.
Investors remain uncertain about future interest rate paths as inflation risks stay elevated due to higher energy prices.
It is one of the world’s most important oil shipping routes, making it highly sensitive for global energy markets.
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