Notable market news this past week (17-May-26)
Here is the Skeptivest roundup of the latest market headlines for the week
🌍 US labour market stays resilient despite sticky inflation, Senate confirms Trump’s pick Kevin Warsh to lead Federal Reserve
After several months of volatility, US non-farm payrolls recorded two consecutive months of gains, with April’s print coming in at 115k, well above consensus expectations of 65k. Private sector hiring was particularly strong at 123k,underscoring underlying labour demand across the economy, and keeping the unemployment rate steady at 4.3%. Overall, the data suggests that the US labour market has remained largely insulated from recent Middle East tensions, even as inflation has surprised to the upside in April and continues to show signs of persistence.
Political developments also drew attention, with the Senate confirming Kevin Warsh as President Trump’s pick to lead the Federal Reserve, adding a new layer of complexity and dimension to the policy outlook ahead amid an already inflationary environment. Despite his political backing, Warsh is generally viewed as centrist-to-hawkish in orientation, with an emphasis on price stability and a cautious approach to premature easing. As a result, markets saw a modest repricing of US rate expectations, with Treasury yields edging higher as rate-cut expectations were scaled back slightly, reinforcing a “higher-for-longer” narrative. USD saw mild support from firmer rate differentials, while equities remained broadly steady, supported by AI-related technology stocks.
☕️ Quick fire happenings to note
🌏 Global macro
- US inflation came in hotter than expected in April, reinforcing concerns that underlying price pressures remain persistent and are not easing as quickly as previously anticipated. Headline CPI increased 0.6% m/m in April, with annual inflation accelerating to 3.8% y/y in April from 3.3% y/y in March. Core CPI, which strips out volatile food and energy costs, also came in above expectations, rising 0.4% m/m, highlighting persistent price pressures across the economy. The higher inflation was led by higher energy costs amid the Iran conflict, which has disrupted oil markets, alongside stronger food prices and continued upward pressure in services such as rents and airfares. Overall, energy-related components accounted for over 40% of the monthly increase, highlighting the broad-based nature of inflationary pressures. In response, treasury yields climbed sharply, reflecting a “higher for longer” interest rate environment, while markets dialled back expectations for rate cuts.
- Trump-Xi summit was broadly constructive intone but delivered limited immediate breakthroughs, with discussions centred on trade, Taiwan, and energy security, alongside limited progress on tariff-related adjustments. China signalled progress on agricultural trade through plans to expand market access and reduce tariffs on select US goods, while both sides also agreed in principle to address non-tariff barriers and promote broader two-way farm trade. Market watchers highlighted the possibility of a 10% cut in soybean tariffs, which could revive demand from private Chinese crushers that were largely absent during last year’s US harvest. While the developments supported cautious optimism around trade normalisation and agricultural purchases, markets continued to view the overall outcome as incremental, with deeper structural tensions around security and strategic competition remaining unresolved.
- Global central banks continued to signal concerns over inflation risks, as higher crude prices from Middle East tensions spillovers into transport, food, and manufacturing costs, raising fears of renewed inflationary pressures. China’s PBOC warned that elevated global commodity prices are feeding through into domestic inflation, even as it maintained a relatively accommodative stance to support growth. In contrast, the ECB and Bank of Japan adopted a more cautious-to-hawkish bias, with more policymakers increasingly acknowledging upside risks from imported inflation. Overall, this divergence in policy responses reinforced a more cautious global rates backdrop amid uneven growth and lingering inflation pressures.
🏦 Individual stocks/companies
- Alibaba Group (-3.48% past 5D) shares saw significant volatility over the past week, after reporting its FY2026 results which reflects a divergence between strong AI momentum and weaker overall profitability. Revenue rose around 3% y/y to approximately RMB243 billion, broadly in line with expectations, but earnings came in sharply below forecasts as heavy investment in AI infrastructure, quick commerce, and cloud expansion weighed on margins. Cloud intelligence remained a key bright spot, posting strong double-digit growth driven by accelerating AI adoption, while e-commerce showed relatively stable but slower growth amid intensifying competition and ongoing investment spending. Despite the headline earnings miss and weaker profitability, sentiment was supported by strong AI-related growth and improving long-term monetisation prospects, with markets viewing the earnings pressure as investment-driven rather than structural. Alibaba’s shares initially declined on the headline miss but subsequently rebounded and ended higher as investors refocused on its AI and cloud growth trajectory rather than near-term margins compression.
- Circle Internet Group Inc (-4.08% past 5D) initially traded higher, on optimism surrounding the Senate’s progress on the Clarity Act, following amendments aimed at balancing innovation with deposit stability. The revised wording was seen as a constructive compromise between banks and crypto firms, prohibiting deposit-like interest payments on stablecoins while still allowing usage-based incentives like staking which preserves flexibility for crypto firms to drive stablecoin adoption through trading, payments, and ecosystem incentives. Over the longer term, the framework is viewed as supportive of stablecoins evolving into more productive financial instruments, strengthening the broader crypto value proposition.
- Singapore Airlines Ltd (+1.58% past 5D) shares fell initially before rebounding, after reporting weak FY2026 earnings, with net profit falling 57.4% to S$1.18billion, mainly due to the absence of a one-off gain from the prior year and losses from its Air India stake, although underlying operating performance remained strong on resilient travel demand and higher passenger volumes. Operating profit rose 39% to a record level, supported by record revenue of about S$20.5 billion and continued strength in passenger traffic. The stock initially saw some pressure on the earnings headline but later stabilised, as investors focused on the strong operating momentum and sustained demand outlook, even as concerns lingered around rising jet fuel costs and margin compression from higher input prices going forward.
🇸🇬 Singapore related
- Home-grown JustCo has filed a preliminary prospectus for a potential SGX Mainboard listing, aiming to tap into MAS’ S$6.5billion Equity Market Development Program (EQDP) and rising demand for flexible workspaces. The co-working operator is targeting around S$100 million in gross IPO proceeds to fund regional expansion across Asia. The move comes alongside a return to profitability in FY2025, supported by higher occupancy and a shift toward a more capital-light operating model. However, valuation and timing remain unconfirmed, with execution risk and the cyclical nature of office demand still key considerations.
