May 22, 2026

Global stock markets opened the week mixed before finding renewed momentum from continued strong corporate earnings reports and fluctuating optimism regarding Iran. Crude prices moved up over the weekend, resulting in ongoing upward pressure on U.S. Treasury yields. The U.S. 10-year yield broke above potential resistance at 4.6%, and the U.S. 30-year yield climbed to its highest level since 2007. Rumors of fresh military action in the Gulf swirled before Trump announced to the world, yet again, he was holding off a large-scale, imminent attack at the behest of Gulf partners to allow for another round of “serious” talks with the Iranians. Crude oil prices moved lower, yields reversed, and stocks rose once again on the notion that this time it would be different, despite both sides remaining dug in on the two key issues: nuclear development and the Strait. Kevin Warsh took the helm at a shifting Federal Reserve on Friday amid a growing chorus of hawkish commentary from FOMC members, and rising market expectations the Middle East conflict will force the Fed’s hand to raises rates this year. Crude oil prices remained on a lower trajectory following reports Far East bound oil tankers carrying ~6M barrels of oil transited through the Strait of Hormuz. Rising global bond yields were capped by softer energy prices and weak PMI and CPI prints in Europe and Asia. The U.S. dollar gained ground, particularly against the Japanese Yen. Minutes of the April FOMC meeting confirmed many members wanted to remove the dovish forward guidance language from the statement, and many Fed watchers speculated that would likely be Warsh’s first move since it aligns with his goal of returning to a more tight-lipped Fed. Late season earnings reports remained generally solid, led by bellwethers Nvidia and Walmart. For the week, the S&P gained 0.9%, the DJIA rose 2.3%, and the Nasdaq added 0.5%. European bourses surged with the German DAX rising 3.9% and the CAC 40 gaining 2.1%. Asia Pacific stock markets were bifurcated, with Japan advancing 3.1% and the Hang Seng falling 1.4%. Your BSD Global Tech Hedge Fund gained 0.2% this past week. Nvidia’s earnings report was the most anticipated of the week and it did not disappoint: Along with the usual top and bottom line beats, CEO Jensen Huang crowed that “demand has gone parabolic.” This allowed the share price to hold onto most of the gains from a recent run-up. Micron also affirmed the unprecedented demand for its memory products saying its already impressive financial outlook had improved further since its last earnings report less than two months ago. Google added to the tech frenzy at its annual I/O conferencing, touting a sevenfold increase in processing of tokens since last year, to an astounding 3.2 quadrillion per month. The housing market saw some positive tea leaves in reports from Home Depot and Toll Brothers this week as both beat estimates. Though HD fell short on same store sales and said that metric may struggle to improve, it stated that homeowners appear to be more protected financially than other cohorts and continue to show resilience in their shopping habits. Meanwhile Toll Brothers continued to raise expectations for FY26 deliveries and average unit prices moved closer to $1M for the luxury home builder. Big box retailers Walmart and Target beat earnings estimates, but both maintained a cautious outlook with consumers, especially at the lower end, feeling some financial pressure amid the macroeconomic uncertainty. Discount retailers Ross Stores and TJX both easily exceeded guidance, showing consumers are still buying but shopping for bargains. Higher end retailers are still showing that the upper side of the K-shaped economy is doing well. Case in point, Ralph Lauren beat estimates by a wide margin and reported a whopping 17% same store sales growth, giving management confidence to announce a significant dividend increase as well. SpaceX delivered its expected S1 filing for its upcoming IPO, giving a deep dive into its complex and growing business and aspirations for space exploration and colonization that may initially be largely funded by Starlink, which has become the financial backbone of the company. OpenAI also appears to be racing toward its own trillion dollar IPO, which reports this week said could come as soon as September after Elon Musk’s case against the startup was thrown out on Monday.

Investors head into a U.S. holiday-shortened week with investors focused on inflation data, a fresh wave of Federal Reserve commentary, and earnings from the technology sector. The main macro event will be Thursday’s core PCE price index report, the Fed’s preferred inflation gauge — for now. Economists expect the core rate to come in at 3.3%, keeping pressure on policymakers as markets continue to debate the path for rates under new Fed Chairman Kevin Warsh. A heavy slate of Fed speakers throughout the week, including John Williams, Austan Goolsbee, and Neel Kashkari, could further shape expectations. Earnings reports from Marvell Technology, Salesforce, Costco, Dell Technologies, and Snowflake will provide fresh insight into AI spending, enterprise demand, and consumer health. Dell’s earnings call will be closely watched for commentary on AI infrastructure trends following Nvidia’s closely followed results last week. Investors will also monitor Meta Platforms’ annual meeting for updates on AI spending and capital returns, while Nvidia and Applied Materials executives are due to appear at investor conferences. Outside markets, Disney’s “Star Wars: The Mandalorian & Grogu” is expected to dominate the Memorial Day box office, marking the franchise’s first theatrical release since 2019.

Our BSD Global Tech Hedge Fund holds an 8% cash position and a stock portfolio that is 92% invested across two dozen tech vendors and tech end users. This portfolio is hedged with a 47% short equity index against the notional value of the invested stock portfolio. This hedge will incrementally grow (from the laddered Nasdaq put options strategy) if the stock market comes under pressure.