Macro Events — May 20, 2026

Us Stock Market

U.S. stocks pulled back over this period, with the S&P 500 and Nasdaq each dropping roughly 0.5% on Tuesday alone, as the standoff between the U.S. and Iran kept energy prices elevated, which pushed consumer and producer inflation to multi-year highs and drove the interest rate on the 10-year government bond to a 16-month high of 4.76%. Higher borrowing costs hit the tech sector especially hard, where a wave of speculative buying in AI stocks reversed after Seagate's CEO warned that building new factories would "take too long," sending the stock down 10% for the week and dragging down chipmakers like Micron, Nvidia, and Broadcom. Traders now expect the Fed to hold rates steady or even raise them later this year, a sharp shift that weighed on the broader market's mood.

Oil Price

Oil prices swung sharply over the past few days, pulled between fears of continued fighting in the Middle East and hopes for a U.S.-Iran deal. Prices dipped after President Trump called off a planned strike on Iran and floated easing oil sanctions, but then bounced back because the Strait of Hormuz, a critical shipping route, remained mostly closed, keeping supply tight. The ripple effects spread worldwide: India's currency hit record lows due to rising fuel import costs, inflation ticked up in the Netherlands from higher transport prices, and U.S. bond markets started pricing in possible rate increases as investors braced for an energy-driven jump in prices.

Natural Gas Price

Natural gas prices swung back and forth over the past few days as Middle East tensions shifted rapidly. Reports of strikes on energy facilities in the Persian Gulf pushed UK gas prices toward a six-week high, since roughly one-fifth of global liquefied natural gas supply has been cut off since the conflict began in late February. Prices then pulled back after President Trump postponed a planned strike on Iran and Iran signaled it would suspend its nuclear program, though they climbed again as peace talks stalled, while US prices separately drifted up to a seven-week high as some producers cut back output in response to weak local prices.

Gold Price

Gold dropped close to 4% over the past week, falling near $4,550 an ounce, as the ongoing Iran conflict kept the Strait of Hormuz closed, pushing energy prices higher and driving U.S. inflation to a three-year high. That inflation surge led investors to expect the Federal Reserve could raise interest rates rather than cut them, which strengthened the dollar, pushed up bond returns, and made gold less attractive by comparison. Late Monday, gold briefly recovered some losses on unconfirmed reports of a possible breakthrough in which the U.S. would lift sanctions on Iranian oil in exchange for Tehran freezing its nuclear program.

Bond Yield

The interest paid on the 10-year U.S. Treasury bond climbed to 4.76%, a 16-month high, as the ongoing standoff between the U.S. and Iran kept oil prices elevated, pushed consumer inflation to a three-year high, and made investors demand more return to hold government debt. A brief dip below 4.59% came on Monday after reports that Washington proposed easing oil sanctions on Iran as part of a possible deal, but yields snapped back up after President Trump warned that strikes on Iran could resume within days. The rising cost of energy is now fueling bets that the Fed may raise interest rates later this year instead of cutting them, which pushed longer-term bond interest rates to levels not seen since 2007 on the 30-year bond.

Us Economy

Military strikes and escalating conflict with Iran kept the Strait of Hormuz largely closed to shipping, pushing oil prices roughly 50% above pre-war levels and driving U.S. consumer inflation to a three-year high in April. That inflation surge sent the interest rate on 10-year government bonds to a 16-month high near 4.76%, which raised mortgage rates, cut mortgage applications, and fed growing bets that the Federal Reserve might raise rates again before year-end instead of cutting them. Stocks also pulled back, with the S&P 500 and Nasdaq 100 each dropping about 0.5% on Tuesday as rising borrowing costs and a sharp selloff in tech and AI-related shares weighed on investor confidence.

China Economy

Military strikes on Iran pushed global energy prices higher, which fed into rising costs across China's economy and added to a slowdown already visible in weak retail sales and factory output. Chinese stocks slipped, iron ore prices fell to a three-week low on fading demand for steel, and the country's 10-year bond interest rate dropped to a one-month low as investors bet the government would eventually roll out more support. China's central bank held borrowing rates at record lows for a twelfth straight month, signaling caution as policymakers weigh slowing growth against rising inflation.

Europe Economy

The Iran conflict kept oil prices near four-year highs, pushing Eurozone inflation to 3% in April, well above the European Central Bank's 2% target, while economic growth slowed to just 0.1% in early 2026 as energy supply disruptions squeezed output. In the UK, a government energy price cap pulled headline inflation down to 2.8%, below forecasts, which drove bond interest rates lower and reduced expectations for Bank of England rate increases. Across the continent, markets still expect multiple rate increases from both the ECB and the Bank of England this year, as the unresolved war and closed Strait of Hormuz threaten to keep energy costs elevated for months.