Executive Summary
Global equities advanced over the week ending 8 May 2026, supported by strong U.S. corporate earnings, a better-than-expected April jobs report, and growing optimism around a U.S.–Iran memorandum of understanding aimed at ending the Middle East conflict. The S&P 500 and Nasdaq Composite closed at record highs, while Japan’s Nikkei 225 also set a record. Brent crude fell roughly 6% on easing geopolitical tensions, while gold extended its gains. European markets were more mixed, weighed late in the week by President Trump’s threat of higher tariffs on the EU.
Market Snapshot
Weekly performance across major global indices (week ending 08 May 2026):
| Index | Friday’s Closing Price | Weekly Change | Direction |
| DJIA | 49,609.16 | 0.22 | ▲ |
| S&P 500 | 7,398.93 | 2.33 | ▲ |
| NASDAQ Composite | 26,247.08 | 4.51 | ▲ |
| FTSE 100 (UK) | 10,277.00 | -0.84 | ▼ |
| CAC 40 (France) | 8,112.57 | -0.03 | ▼ |
| STOXX Europe 600 | 612.14 | 0.1 | ▲ |
| Nikkei 225 (Japan) | 62,713.65 | 5.38 | ▲ |
| CSI 300 (China) | 4,871.91 | 1.34 | ▲ |
| Hang Seng (Hong Kong) | 26,393.71 | 2.39 | ▲ |
| Brent Crude | 101.29 | -6.36 | ▼ |
| Gold | 4,720.40 | 2.05 | ▲ |
Foreign Exchange
(For the week ending 8 May 2026)
| Pair | Friday’s Close | Week’s Change |
| EUR/USD | 1.1732 | 0.0003 (0.03%) |
| USD/JPY | 156.829 | -0.052 (-0.03%) |
| GBP/USD | 1.3556 | -0.0047 (-0.35%) |
| USD/CHF | 0.7802 | -0.0012 (-0.15%) |
| AUD/USD | 0.7209 | 0.0008 (0.11%) |
U.S. Markets Overview
U.S. equity markets rallied to record highs, buoyed by strong corporate earnings. As of 7 May, around 85% of S&P 500 companies had reported, with just under 85% topping consensus estimates and an aggregate positive earnings surprise of about 19%. Information technology led the index, helped by encouraging news flow around AI infrastructure and consumption, while energy and utilities lagged.
Labour data was solid. April nonfarm payrolls rose 115,000 (vs. consensus 62,000), with March revised higher to 185,000 — the strongest two-month run of payroll gains since 2024. The unemployment rate held at 4.3%, though the participation rate fell to its lowest since October 2021. Weekly jobless claims came in at 200,000 and continuing claims slipped to 1.77 million, the lowest since 2024. Challenger data showed layoffs up 38% sequentially but down 21% year on year, with tech leading job-cut announcements, often citing AI.
Other data was mixed. Q1 labour productivity slowed to a 0.8% annualised pace from 1.6% in Q4 2024. March construction spending rebounded 0.6% and factory orders rose 1.5%, helped by surging demand for electronics tied to AI build-out. However, the University of Michigan’s preliminary May consumer sentiment index fell to 48.2, its lowest reading on record, with respondents citing higher gasoline prices and tariffs.
European Markets
The pan-European STOXX Europe 600 ended a volatile week with modest gains in local currency terms. Sentiment improved early in the week on easing Middle East tensions and generally strong earnings, but Trump’s threat to impose “much higher” tariffs on the EU unless it cut its tariffs on U.S. goods to zero pressured markets later in the week. Germany’s DAX rose 0.19%, Italy’s FTSE MIB gained 2.16%, France’s CAC 40 was little changed, and the UK’s FTSE 100 fell 1.26%. The London Stock Exchange was closed on 4 May for Easter Monday.
On policy, Bundesbank President Joachim Nagel signalled the ECB is likely to raise rates at its next meeting unless inflation improves substantially. Eurozone producer prices rose 3.4% month on month and 2.1% year on year in March — the biggest monthly increase since August 2022 — driven by sharply higher energy prices. German factory orders surged 5.0% in March, well above the 1.0% expected, though German construction activity fell sharply, with the S&P Global Construction PMI dropping to 42.1 in April. Spain’s industrial production rose 1.8% year on year in March, and the UK Composite PMI rose to 52.6 from 50.3.
Asian Markets
Japan
Japanese equity markets were closed Monday through Wednesday for Golden Week. In the shortened trading week, the Nikkei 225 surged 5.38% to a record high on Thursday, while the broader TOPIX advanced 2.70%. Gains were led by technology and semiconductor shares, supported by AI-related demand and optimism around a potential U.S.–Iran diplomatic breakthrough. Falling oil prices helped ease concerns about energy costs for Japan, which relies heavily on Middle East crude. The 10-year JGB yield eased to 2.48% from a near three-decade high of 2.50%. The yen was volatile amid intervention speculation but ended the week little changed against the U.S. dollar. Inflation-adjusted wages rose 1.0% year on year in March — below the 1.8% consensus and February’s 2.0%, but marking the first three-month run of real wage gains since 2021.
China
Chinese equities advanced as mainland markets reopened after the 1–5 May holiday. The CSI 300 rose 1.34% and the Shanghai Composite gained 1.65% in local currency terms, while Hong Kong’s Hang Seng rose 2.39%, led by technology and select consumer names. The RatingDog China General Services PMI rose to 52.6 from 52.1, and the composite PMI output index lifted to 53.1 from 51.5, driven by stronger domestic demand even as export orders fell for a second month. Ahead of the planned 14–15 May Trump–Xi meeting in Beijing, U.S. and Chinese officials reportedly intensified discussions on extending the current trade truce and exploring agreements on agricultural purchases, AI safeguards, and supply chains. May Day holiday travel data showed domestic trips up 3.6% year on year and tourism spending up 2.9% to RMB 185.5 billion, though spending per trip dipped slightly, pointing to cautious discretionary consumption.
Commodities
Oil
Brent crude fell roughly 6% over the week to around $100 a barrel after reports that the U.S. and Iran were nearing a memorandum of understanding that could include a gradual reopening of the Strait of Hormuz. Capital Economics noted that severe strains in the physical oil market had eased, helped by a ramp-up in U.S. refined product exports and softer Asian refining run rates. Even so, oil product prices in Asia remain 40–60% above pre-war levels, and analysts caution that energy exports from the Gulf would likely take around two months to recover to 80% of pre-war levels and up to six months to fully normalise after any reopening. Capital Economics’s baseline forecast is for Brent to average $80 a barrel in Q4 2026, with risks skewed to the upside.
Sentiment shifted sharply at the end of the week. Oil surged on Sunday evening after President Trump rejected Iran’s latest proposal — which reportedly offered to transfer some highly enriched uranium to a third country but stopped short of dismantling nuclear facilities — calling the response “totally unacceptable.” Brent jumped as much as 3.5% to $104.80 and WTI climbed near $99 in early trade, with the near-closure of the Strait of Hormuz since late February continuing to choke off supplies.
Gold
Gold rose 2.05% to $4,720.40, supported by safe-haven demand amid persistent geopolitical uncertainty. Gold-related shares were among the strongest performers mid-week, with the NYSE Arca Gold Bugs Index jumping 7.6% on Wednesday.
Week Ahead
- U.S. inflation data: April CPI and PPI reports will be in focus as investors look for signs that higher oil prices are feeding into broader inflation.
- Earnings: Fox, Barrick Mining and Constellation Energy report before the open on Monday.
- U.S.–Iran talks: Markets will watch closely after Trump rejected Iran’s latest proposal over the weekend, with oil prices rebounding toward $100.
- Trump–Xi meeting: The planned 14–15 May meeting in Beijing is expected to focus on extending the trade truce and discussions on agriculture, AI safeguards and supply chains.
Disclaimer
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