Iran deal optimism sends oil to five-week low as Wall Street hits fresh records.
This week @15:26pm Friday 29th May in London.
Markets:
- FTSE 100 fell 0.49% this week to 10,414.99, as the sharp drop in Brent crude weighed on energy stocks, with Shell declining around 2%. Rate-sensitive and consumer-facing stocks partially offset losses as gilt yields eased.
- S&P 500 rose 1.21% this week to 7,563.63, closing at a record high as AI-driven technology stocks surged following Snowflake’s blowout quarterly results and Microsoft’s launch of a new enterprise AI coding model.
- Nasdaq Composite rose 2.84% this week to 27,092.36, as the AI software rally extended broadly across cloud data, semiconductor and enterprise software names.
- Euro Stoxx 50 was flat this week, falling 0.09% to 5,193.27, as the relief from falling energy prices was offset by continued concern over eurozone growth and inflation pass-through.
Bonds:
- UK 10-year gilt yields fell 7.2 bps this week to 4.82%, their lowest level since mid-April, as US-Iran deal optimism reduced energy-driven inflation concerns.
- US 10-year Treasury yields fell 10.9 bps this week to 4.45%, as progress in US-Iran ceasefire negotiations and a softer-than-expected monthly PCE print reduced near-term inflation fears.
Commodities:
- Brent crude fell 11.94% this week to $91.18/bbl, its sharpest weekly decline in months, after President Trump announced a US-Iran deal is “largely negotiated,” including terms to reopen the Strait of Hormuz. Reports of a 60-day ceasefire extension and formal nuclear talks framework weighed heavily on prices.
- Gold rose 0.97% this week to $4,566.90/oz, with modest residual safe-haven demand persisting despite easing geopolitical tension.
- Copper rose 0.40% this week to $6.4045/lb, broadly stable as demand signals remained mixed.
FX:
- GBP/USD fell 0.11% this week to 1.3418, with sterling constrained by residual UK political uncertainty and a partial dollar recovery as risk appetite fluctuated through the week.
- GBP/EUR fell 0.43% this week to 1.1526, as the euro found modest support from easing energy import concerns following the sharp drop in oil.
Macro:
- US April PCE rose 3.8% y/y, the highest since May 2023 and in line with expectations, as the Iran energy shock continued to feed through consumer prices.
- US Q1 GDP was revised down to 1.6% annualised growth (from the initial 2.0% estimate), missing the Wall Street consensus, driven by downward revisions to consumer spending and investment.
- UK CPI for April fell to 2.8% y/y (from 3.3% in March), aided by base effects from last year’s energy bill increases and softer motor fuel prices.
- Geopolitical: President Trump announced that a US-Iran deal is “largely negotiated,” covering a 60-day ceasefire extension, reopening of the Strait of Hormuz to commercial shipping, and a framework for nuclear negotiations. Washington and Tehran have agreed in principle, though final sign-off from both leaders is pending and no formal agreement has been signed.
Company news:
- Microsoft rose approximately 3.5% on Thursday after launching a new AI coding model targeted at enterprise developers, reinforcing the company’s positioning across the generative AI software stack.
- ServiceNow rose approximately 6.5% over the week, carried by the AI sector rally following Snowflake’s earnings beat. The two platforms maintain a formal data integration partnership, and new agentic AI production deployments were announced alongside Experian and several other enterprise partners, signalling movement from pilots into live workflows.
- Shell declined approximately 2% mid-week as the sharp drop in Brent crude weighed on FTSE 100 energy stocks broadly.
- NVIDIA — no material news this week following last week’s Q1 FY2027 earnings beat. The stock participated in the broader AI sector rally.
What we will be keeping an eye on next week…
w/c 1st June 2026
- US Non-Farm Payrolls (Friday 5 June): the key macro event of the week. Consensus is pointing to a marked deceleration in job creation for May, which will shape near-term Federal Reserve rate expectations ahead of the 16–17 June FOMC meeting.
- US ISM Manufacturing PMI (Monday 1 June), JOLTS (Tuesday 3 June), ADP Employment and ISM Services PMI (Wednesday 4 June): a full calendar of US data feeding into the payrolls picture and the broader inflation-versus-growth debate.
- Eurozone flash CPI for May (Tuesday 3 June): watched for evidence of whether the recent drop in energy prices is beginning to ease headline inflation ahead of the ECB’s June meeting.
- US-Iran ceasefire developments: any formal announcement of a signed deal, or a breakdown in talks, will be the dominant catalyst for oil prices and risk assets. Markets are positioned for a deal; the risk is to the upside in energy prices if talks stall.
Markets move constantly and the numbers in this update will change. This is a snapshot only, pulled together from a range of sources, and is meant as a quick guide rather than a precise record. It’s not investment advice and shouldn’t be used to make trading or investment decisions. If you need more accurate or specific data over a defined period, please get in touch with a member of the team who will be happy to help.
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