10 min read Weekly Recap
US Global stocks recap
US stocks rose for a sixth straight week, marking the longest winning streak since 2024. The S&P 500 gained 2.3% to close at a record 7,398.93 on Friday. The Dow Jones added 0.2% to 49,609.16, underperforming amid weaker industrials.
A stronger-than-expected April jobs report lifted sentiment, as the labor market showed resilience and eased stagflation concerns. Apple’s earnings further supported technology stocks.
Markets advanced despite renewed military exchanges in the Strait of Hormuz on Monday and Thursday, where US destroyers were targeted by Iranian missiles, drones, and small boats. President Trump stated the ceasefire remained in effect, referring to the incidents as “just a love tap”.
Sustained momentum in the S&P 500 will depend on whether strong Q1 earnings and resilient hiring can offset inflation pressures expected in Tuesday’s CPI release.
Major US data/themes
US nonfarm payrolls increased by 115,000 in April, exceeding the Dow Jones consensus of 55,000 and marking a second consecutive monthly gain. The unemployment rate remained at 4.3%. Average hourly earnings rose 0.2% for the month and 3.6% year-on-year, both below expectations. February was revised to a loss of 156,000, while March was revised up to a gain of 185,000.
The Nasdaq rose approximately 4.5% for the week, closing at a record 26,247.08 on Friday, led by a 3% gain in the technology sector. Apple reported Q2 fiscal earnings of $2.01 per share, up 21.8% year-on-year, with revenues of $56.99 billion, a record for the March quarter. This result supported AI capital expenditure themes among major technology firms.
A strong US CPI reading on Tuesday, combined with the Warsh confirmation, could increase Nasdaq volatility, especially given stretched valuations after six consecutive weekly gains.
Gold moves
Gold gained approximately 2.2% for the week, closing at $4,716 per ounce on Friday, its highest level since April 22. The metal benefited from a sharp midweek decline in oil prices and renewed optimism about a US-Iran agreement, easing inflation concerns that had weighed on bullion.
Despite the rebound, gold remains down by more than 10% since the conflict began in late February, pressured by high energy prices and expectations of prolonged higher interest rates. Federal Reserve Bank of Chicago President Austan Goolsbee noted that inflation has not moved closer to the 2% target since the onset of the conflict.
Military exchanges in the Strait of Hormuz briefly limited gold’s gains, but the appointment of Kevin Warsh as the next Fed Chair, seen by some as a potential dovish shift, provided additional support.
A strong US CPI reading on Tuesday could boost gold as demand for inflation hedges increases. Conversely, a softer reading or signs of de-escalation in Iran could push gold below $4,515.
Oil moves
Brent fell about 8% for the week, closing at $98.4 per barrel on Friday. The waterway has been effectively closed since late February, with the International Energy Agency estimating a disruption of approximately 14 million barrels per day in global supply.
On Thursday, the month-long ceasefire faced its most serious test when US Central Command reported that three US destroyers were attacked by Iranian missiles, drones, and small boats while transiting Hormuz into the Gulf of Oman. US forces responded by striking Iranian military targets, while officials stressed they did not seek escalation.
Tehran indicated it would provide an updated response to a US peace proposal via Pakistani diplomatic channels in the coming days. JPMorgan economists warned that supply buffers protecting oil markets from the conflict are eroding, and signs of demand destruction are increasing.
The near-term direction of Brent depends largely on whether Iran’s response leads to diplomatic progress or a breakdown. A failure to reach an agreement could quickly push prices back toward $114.
Indian markets
Indian equities continued to decline. The Nifty 50 closed at 24,176 on Friday, May 8, while the Sensex fell 516 points to 77,329, pressured by rising tensions in the Middle East and weak financial-sector earnings. State Bank of India shares dropped 7% after reporting a contraction in its Q4 net interest margin, pulling the Nifty PSU Bank index down 3.06%.
The HSBC India Services PMI exceeded expectations, rising to 58.8 in April from 57.5 in March. The final Manufacturing PMI for April increased to 55.9 from 53.9. The composite index reached 58.2, indicating the strongest private-sector momentum in several months despite geopolitical challenges.
Foreign institutional outflows continued to pressure sentiment, with cumulative 2026 outflows surpassing $21 billion. The Indian rupee reached a record low of 95.27 against the US dollar on Monday before recovering slightly to close near 94.61 by Friday.
A stronger-than-expected Services PMI provided some support, but with India CPI due Tuesday and oil prices volatile, the Nifty 50 is likely to remain under pressure from foreign selling unless there is a clear US-Iran breakthrough.
Week Ahead (US & Asia)
US CPI (Tuesday)
The US April CPI release on Tuesday, May 12, is the week’s most significant data point. Consensus forecasts headline CPI rising to 3.7% year-on-year from 3.3% in March, with a 0.6% monthly increase. Core CPI, excluding food and energy, is expected to reach 2.7% year-on-year from 2.6%, with a 0.3% monthly gain.
The April data reflect the first full month of elevated gasoline prices, which exceeded $4 per gallon due to US oil-refining disruptions stemming from the closure of the Strait of Hormuz. March CPI was already at its highest in over a year, and Kiplinger economists expect the 12-month rate to approach 4.0% in the coming months unless gasoline prices decline.
A strong CPI reading would support the FOMC’s hawkish stance from April 29 and keep the dollar strong. With the Dow Jones lagging last week’s broader rally, an upside CPI surprise could pressure cyclical stocks, especially in financials and consumer discretionary sectors.
A softer-than-expected CPI would support the Dow Jones and reduce pressure in the rate-cut debate. A stronger reading would weigh on the index, especially if core inflation broadens beyond energy.
India CPI (Tuesday)
India’s April CPI is also scheduled for Tuesday, May 12, alongside the US release, making it a key day for South Asian markets. March CPI rose to 3.40% year-on-year from 3.21% in February, the highest in over a year. Food inflation reached 3.87%, with rural at 3.63% and urban at 3.11%.
April CPI is expected to remain near or slightly above March’s level, as higher global crude prices increase transport and energy costs despite stable food prices. The Reserve Bank of India maintains a 4% inflation target within a 2–6% band through 2031, providing flexibility but keeping the rupee sensitive to surprises.
USD/INR remains near record highs after reaching 95.27 on May 4, as foreign portfolio outflows exceed $21 billion year-to-date and the import bill rises due to high oil prices. A higher-than-expected CPI would limit the RBI’s ability to support growth and could push USD/INR back toward 95.
A softer CPI reading would ease pressure on the rupee, while a strong print combined with ongoing oil price pressures could push USD/INR to new record highs.
Powell-Warsh Fed transition (Thursday-Friday)
Jerome Powell’s term as Federal Reserve Chair ends on Friday, May 15. The Senate is expected to vote on Kevin Warsh’s nomination earlier in the week, possibly coinciding with the CPI release on Tuesday. Powell has indicated he will remain on the Board of Governors after the transition.
This transition represents the most significant change in Fed leadership in over a decade and occurs amid a divided FOMC. The April 29 meeting resulted in an 8-4 vote, the most dissents in a rate decision since October 1992. Three members opposed any easing bias, while Governor Miran supported an immediate 25-basis-point cut.
Warsh’s previous policy statements have highlighted concerns about central bank independence and a disciplined approach to inflation. Markets will closely watch for signals on whether the Fed maintains its hawkish stance or shifts direction, especially as Q1 PCE inflation reached 4.5%, the highest since Q3 2022.
A hawkish confirmation and strong CPI could push USD/CAD toward 1.3810. Conversely, if Warsh signals tolerance for above-target inflation, the dollar could weaken against the Canadian dollar.
Bottom line
The Iran conflict remains the primary macroeconomic driver, but this week’s calendar shifts attention to the growth-inflation balance as US and Indian CPI are released on the same day. A strong US CPI reading combined with the Powell-Warsh Fed transition could reinforce a higher-for-longer narrative, strengthening the dollar and pressuring gold and emerging-market currencies, including USD/INR. India’s CPI will be equally important for sentiment in South Asia, with the rupee already near record lows. Brent will continue to respond to Iran-related developments via Pakistani diplomatic channels. USD/INR is most sensitive to the dual CPI releases, while USD/CAD will reflect the Fed transition. There is a risk that Tuesday’s data and the leadership change later in the week will reinforce each other in a hawkish or dovish direction, amplifying cross-asset moves rather than offsetting them.
Trading involves risk.
Author
Risk Disclaimer
The content provided here is for informational purposes only. It is not intended as personal investment advice and does not constitute a solicitation or invitation to engage in any financial transactions, investments, or related activities. Past performance is not a reliable indicator of future results.
The financial products offered by the Company are complex and come with a high risk of losing money rapidly due to leverage. These products may not be suitable for all investors. Before engaging, you should consider whether you understand how these leveraged products work and whether you can afford the high risk of losing your money.
The Company does not accept clients from the Restricted Jurisdictions as indicated in our website/ T&C. Some services or products may not be available in your jurisdiction.
The applicable legal entity and its respective products and services depend on the client’s country of residence and the entity with which the client has established a contractual relationship during registration.
