Public Markets 3 Days

Last updated: May 13, 2026, 11:30 PM ET

Geopolitics & Energy Markets

Geopolitical tensions surrounding the Middle East, particularly the Iran war, continued to dictate energy market movements and spill over into Asian reserve stability. Oil prices edged slightly higher ahead of the Trump-Xi summit as traders weighed potential supply disruptions, though some volatility was noted as a Japanese supertanker made a rare transit through the Strait of Hormuz. This environment is severely impacting central bank liquidity, with foreign-exchange reserves slumping across Asia, notably in the Philippines and India, as policymakers spend heavily to defend local currencies against elevated oil costs. Meanwhile, the IEA warned of further price spikes as oil inventories rapidly draw down, despite the conflict tempering global demand projections by 420,000 barrels per day this year IEA Warns. Concurrently, Saudi Arabian oil exports to China are projected to plunge in June to a range of 13 to 14 million barrels, while discounts on Russian crude widened for the first time since the war began, reflecting shifting expectations for a conflict resolution.

Concerns over Middle East stability are causing ripple effects across related sectors, from shipping to infrastructure investment. Hunter Hunt, head of Hunt Oil, voiced apprehension regarding the "nightmare scenario" of protracted damage to Middle Eastern energy infrastructure leading to years of lower oil production. In response to supply shocks, Asian nations are increasing coal shipments as an alternative to disrupted gas supplies, while hedge funds are hedging by betting on biofuels, anticipating a surge in corn and soyabeans prices Hedge funds bet. The disruption has also caused financial pain for regional carriers, with Air New Zealand forecasting a substantial full-year loss due to soaring jet-fuel costs, prompting consideration of further flight cuts. In a rare navigational event, a Qantas executive is aggressively adding nearly 1 million seats on trans-Tasman routes, aiming to squeeze the struggling Air New Zealand.

US-China Relations & Trade

The highly anticipated meeting between President Trump and Xi Jinping occurred against a backdrop of significantly degraded diplomatic warmth, contrasting sharply with previous administrations' cultural exchange gestures As Trump and Xi. Relations have become markedly more combative The China Gambit, even as the trade war has settled into an uneasy truce trade war that once threatened. Beijing appears prepared for continued friction, signaling it is “locked and loaded” for a trade showdown and is building a legal arsenal in preparation. Further internationalizing the renminbi, Euroclear is planning to accept Hong Kong-traded Chinese bonds as collateral, a move designed to counter US dollar dominance. On the talent front, China is seeing a resurgence of highly educated nationals returning from the US—dubbed ‘sea turtles’—who are fueling Beijing’s tech ambitions to challenge Silicon Valley.

Global Equity & IPO Markets

Wall Street experienced a strong upward trend driven by AI hardware enthusiasm, with Nvidia reaching a $5.5 trillion valuation and propelling the Nasdaq and S&P 500 to new records Chip Stocks Bounce Back. This tech rally set a positive tone for Asian markets Stocks in Asia were primed. The AI investment boom is attracting substantial capital across various asset classes, evidenced by Blackstone Digital Infrastructure Trust raising $1.75 billion in a US IPO for data centers, while Cerebras Systems secured $5.55 billion in its IPO, capitalizing on semiconductor demand. In a related move, Alphabet Inc. completed a blockbuster $17 billion bond sale and is already marketing further debt. Conversely, private equity faces an exit bottleneck of over $3 trillion in frozen assets The PE Paradox, though volatility is simultaneously creating new deal opportunities.

India’s IPO market is being tested by the current environment, with Blackstone-backed Bagmane REIT set to list, offering a gauge of investor appetite amid broader jitters Private equity cools on India. In Malaysia, IPO volumes are powering toward a 13-year high, spurred by listings including a chip design firm. Meanwhile, the energy transition saw Fervo Energy, which utilizes oil and gas drilling techniques for geothermal power, successfully debut in a $1.9 billion IPO, garnering rare support from the current administration’s energy agenda Shares surge in debut.

Fixed Income & Corporate Finance

Inflation fears are sending tremors through the government bond market, causing investors to flee benchmark rates to the highest levels in nearly a year after sharp producer price data Bond Investors Flee. This rapid repricing saw the US sell 30-year bonds at a 5% yield for the first time since 2007. Treasury yields retracted early increases after the initial inflation shock, though anxiety remains high regarding the Fed keeping rates elevated Wall Street Is Getting More Anxious. In corporate credit, volatility is forcing underwriters for Pacific Equity Partners to sweeten loan terms to attract investors, while private credit firms are reporting a decline in returns due to Fed rate cuts and rising defaults Private Credit’s Hot Streak. Manhattan’s top prosecutor, however, defended the sector, calling private credit a ‘great benefit to the US’ private credit is not.

Sector Specifics & Corporate Moves

The aviation sector is grappling with headwinds stemming from geopolitical conflict. Air New Zealand expects a large annual loss, leading to potential service reductions, while Qantas aggressively expands capacity across the Tasman Sea to gain market share. In the auto industry, European woes are prompting major players like Stellantis and Ford to seek partnerships with Chinese EV manufacturers and traditional rivals for scale. Chinese EV maker Xpeng is exploring options to acquire a European factory or build a new one. Defensive metal stocks are outperforming in India, with the Nifty Metal Index overtaking the FMCG gauge in market capitalization.

In technology, Cisco announced a restructuring involving job shedding as part of an all-in push toward artificial intelligence, while the worsening global memory chip shortage is driving a widening gulf between stock winners and losers. Hedge funds are capitalizing on the AI hardware boom, posting their best month in decades Hedge Funds Are Making a Killing. In Europe, Siemens AG plans a significant €6 billion share buyback program amid a tough operating backdrop, while also reportedly exploring the acquisition of rail technology firm Mer Mec.

Legal & Regulatory Notes

Legal and regulatory scrutiny intensified across several fronts. The Justice Department sued the D.C. Bar over its efforts to discipline government lawyers, escalating an ongoing feud. Separately, the Trump administration is reportedly considering settling a suit against the I.R.S., which could involve dropping audits of the president and his family. Meanwhile, Citadel ordered some quant staff in Hong Kong to relocate to other offices or resign due to escalating data security concerns Citadel tells key researchers. In the UK, political leader Nigel Farage faces investigation regarding a £5 million gift referral to a parliamentary watchdog.