Zylostar Market Wrap – May 22, 2026

Global markets ended the week on a stronger footing as optimism surrounding a potential US-Iran diplomatic breakthrough helped support investor sentiment, despite ongoing geopolitical tensions in the Middle East. Reports suggesting Qatar has coordinated negotiations between Tehran and Washington eased fears of immediate escalation, while traders continued monitoring developments around energy infrastructure and military activity in the region.

US equities remained resilient, with the S&P 500 on track for its longest weekly winning streak since 2023, supported by continued enthusiasm around artificial intelligence and technology shares. In Asia, Japan’s Nikkei 225 surged 2.7%, led by a sharp rally in SoftBank and semiconductor-related companies, while Taiwan equities climbed more than 2% amid renewed optimism around AI expansion.

Oil prices rebounded, with Brent crude rising back above $105 per barrel after concerns over Middle East supply risks resurfaced. However, markets remained relatively calm as investors viewed the probability of broader energy disruptions as limited for now. Gold edged lower, while the US Dollar strengthened against most major currencies as traders awaited further signals from the Federal Reserve and developments in the Iran conflict.

Meanwhile, bond markets saw renewed demand, with the US 10-year Treasury yield easing toward 4.55%. Investors continue to assess whether higher energy prices could eventually feed into core inflation, following comments from White House adviser Kevin Hassett warning about the inflationary risks of an oil shock.

On the economic front, UK retail sales disappointed expectations, adding pressure on the Pound, while Japan’s core inflation slowed more than forecast, weighing further on the Yen. In Europe, stocks extended gains for a fifth consecutive session, led by semiconductor giants ASML and STMicroelectronics, as confidence around the global AI investment cycle remained strong.

By Amir Amidian
Senior Market Analyst | Zylostar