Public Markets 24 Hours

Last updated: May 18, 2026, 11:41 AM ET

Bond Rout & Equity Pressure

Global government bonds sold off sharply as a flood of inflation concerns, stoked by Middle East tensions, drove yields to multi-year highs across major markets. Japanese government bonds extended losses with 10-year JGB yields hitting record territory, while Japan's five-year bond auction drew weaker-than-average demand and NTT Finance postponed a planned yen bond sale until at least early June. The selloff rippled worldwide: US, UK, and Japanese bond yields all climbed to their highest levels in years, the 10-year German Bund yield reached its highest since 2011, and UK 30-year gilt yields touched levels unseen since 1998. Bank of America strategist warned the euro could face pressure if long-dated eurozone yields rise further, while Yardeni Research urged the Federal Reserve to drop its easing bias or lose control of borrowing costs. The damage spilled into equities as Morgan Stanley strategists cautioned that equities face a significant pullback as the bond rout threatens to derail the AI-driven rally. S&P 500 futures fell 0.4% in pre-market trading, and Wall Street analysts signaled the earnings-season honeymoon is over, with inflation now sending sell signals to stock bulls. Morgan Stanley's Wilson warned the stock rally is at risk from the bond rout, while US futures slipped on Monday amid persistent inflation worries.

Middle East Tensions & Energy Shock

President Trump warned Iran that the "clock is ticking" as tensions reignited in the Middle East, sending oil prices higher and bonds lower on inflation fears. Iran's main export hub at Kharg Island remained devoid of tankers for at least its 10th day, with roughly 23 vessels spotted around the facility — the largest cluster since the US Navy blockade began a month ago. Iran deployed around 8,000 troops, fighter jets, and an air defense system to Saudi Arabia under a mutual defense pact, while the IEA chief warned commercial oil inventories are falling at an accelerated pace. Bank of America's commodities chief sees Brent averaging $90 as the best-case scenario for the rest of the year, and European natural gas prices broke above €50/MWh as the Iran war drags on with little sign of resolution. Europe's LNG imports extended a second month of declines as flows rerouted to Asia, and Lufthansa is exploring a euro bond sale as fuel costs squeeze the airline industry. Ryanair CEO Michael O'Leary warned of "casualties" among European carriers if the Strait of Hormuz remains restricted, prompting the airline to suspend guidance after profits rose a third on fuel price swings. The Iran war's ripple effects are also reshaping trade routes, with Syria benefiting from new economic opportunities as vessels seek alternative paths around the blocked strait. G7 finance ministers are set to discuss rising energy prices and sanctions policy at a summit in Paris.

M&A & Corporate Deal Flow

Next Era Energy agreed to pay about $67 billion in stock for Dominion Energy, creating the largest power acquisition ever and