Global Market News
Global Equities Make Gains
Global equities were broadly positive this week, with equities rising toward highs on optimism around a potential U.S.–Iran deal, easing oil prices, and continued strength in AI-driven tech stocks. The S&P 500 and Nasdaq increased 1.43% and 2.39%, respectively, while the Dow Jones gained 0.90%. The US 10-year Treasury fell several basis points to 4.44%, while the price of a barrel of West Texas Intermediate crude oil dropped below the $90 mark, closing Friday at $87.85. Volatility, as measured by the CBOE Volatility Index, declined over the week to 15.32.
USMCA Review Process and North American Growth Forecasts
Negotiations among the United States, Mexico, and Canada over the future of the USMCA have intensified ahead of the agreement’s mandatory July 2026 joint review, as all three countries reported disappointing growth statistics. The U.S. revised its Q1 GDP growth rate from 2.0% to 1.6%. Mexico’s growth forecast dropped from 1.6% to 1.1%, and Canada’s economy unexpectedly shrank by 0.1% in Q1. U.S. and Mexican officials have already launched multiple negotiating rounds focused on rules of origin, economic security, agriculture, and ensuring a “level playing field.” Additional sessions are scheduled through June and July. The United States is maintaining tariffs on imports from both Canada and Mexico, using them as leverage to push for structural changes. Canada, meanwhile, has been less involved in recent bilateral discussions and continues to clash with Washington over tariffs and broader trade policy alignment. With the outcome of the review determining whether USMCA is renewed, revised, or subjected to annual reassessment, the ongoing talks highlight a high-stakes effort to reshape North American trade while balancing domestic political and economic goals.
International Developments
Europe’s Resolve is Tested
European security shifted significantly over the past week as three interconnected developments underscore the growing continental resolve amid continued uncertainty around American commitments to NATO. Britain and Poland signed a landmark defense and security treaty, following similar agreements between France and Germany, to deepen defense cooperation and bolster cybersecurity. The two countries aim to develop next-generation weapons systems in response to what both nations described as Russia’s escalating hybrid warfare and espionage campaigns. The threat was made clear when a Russian drone, part of a massive overnight attack on Ukraine, went astray and struck an apartment building in Galati, Romania. The strike injured two civilians on NATO territory and has prompted Romania to expel Russia’s consul, close the consulate, and convene its top defense body for emergency meetings. NATO Secretary-General Rutte and EU Commission President von der Leyen expressed solidarity with Romania. Compounding this sense of insecurity is Trump’s abrupt reversal on US troop deployments in Europe, having first ordered 5,000 troops withdrawn from the continent, Trump then announced via Truth Social that he would send 5,000 additional troops to Poland. This has left US defense officials, European foreign ministers, and NATO commanders struggling to interpret what the policy means for the region.
U.S. and Iran Near Agreement
The Trump administration held meetings on Friday with top advisors to consider the terms of a tentative agreement between the U.S. and Iran. While Trump reserved the right to make a ‘final determination’ on moving forward with the agreement, the deal would purportedly reopen the Strait of Hormuz, commit Iran to remove all mines within 30 days, clear the U.S. naval blockade, and extend the fragile ceasefire by 60 days. A series of U.S. ‘defensive strikes’ during the ceasefire agreement did little to quell rising anxiety surrounding a renewed outbreak of violence. However, Thursday’s announcement reversed some of those fears. The two countries have yet to agree on the fate of Iran’s highly enriched uranium and the ongoing Israeli military operations in Lebanon; however, an extended ceasefire and accompanying agreement would commit both sides to future diplomatic talks on the subject. Markets displayed cautious optimism that the war is drawing to a close, as evidenced by dropping oil prices and bond yields, as well as the continued equities rally.
Ebola Outbreak in the DRC
The World Health Organization (WHO) Director-General traveled to Congo this week as the Bundibugyo Ebola outbreak, a rare strain with no approved vaccine or treatment, continues to escalate. Over 1,000 suspected cases and more than 220 deaths have been recorded since the outbreak was declared on May 15. Health workers are battling a severe shortage of supplies so acute that some doctors have resorted to using expired medical masks. Further challenges include the community’s distrust of burial protocols, which has triggered at least three attacks on health centers in the Ituri province. The international response has accelerated with the EU airlifting emergency supplies directly to Bunia, and the United States announcing an additional $80 million in aid, bringing its total commitment to over $112 million. However, the Africa Center for Disease Control (CDC) reported that nearly $500 million in pledged contributions shrank to $290 million within days as partners withdrew or reduced commitments. The outbreak is further complicated by one of the world’s most volatile conflict environments. Armed groups, including the ADF and M23 rebels, control key areas across Ituri, North Kivu, and South Kivu provinces. The Trump administration announced a temporary entry ban on travelers from Congo, Uganda, and South Sudan, and said Americans exposed to Ebola would be sent to a new facility in Kenya rather than repatriated to the US.
US Social & Political Developments
US Judge Temporarily Bars $1.8 Billion “Anti-Weaponization Fund”
A federal judge in Virginia has temporarily halted the disbursement of a roughly $1.8 billion fund created by the Trump administration, ruling that no money can be transferred, claims processed, or payments made while legal challenges proceed. The order, issued by U.S. District Judge Leonie Brinkema, blocks implementation of the so‑called “Anti‑Weaponization Fund,” which was designed to compensate individuals who claim the government unfairly targeted them, after critics argued the fund was unlawful and potentially excluded certain groups. The judge’s decision is preliminary and intended to preserve the status quo while the court reviews the case; she scheduled a hearing to consider whether a longer-term injunction should be imposed. The lawsuit against the program is backed by a coalition of individuals and organizations who contend the fund’s structure and eligibility rules are legally problematic, making the court’s forthcoming ruling critical to determining whether the $1.8 billion will ultimately be distributed.
USCIS Memo to Force Most Green Card Applicants to Apply Abroad
A May 21 policy memorandum issued by U.S. Citizenship and Immigration Services (USCIS) has significantly reshaped the green card process by directing that most applicants already in the United States should apply from abroad rather than adjust their status domestically. The memo recharacterizes the process of obtaining permanent residency without leaving the U.S. as an “extraordinary” and discretionary form of relief, while emphasizing consular processing through U.S. embassies or consulates overseas as the default pathway. Under the new guidance, temporary visa holders, including students, tourists, and many workers, are expected to leave the country and complete their applications abroad, unless they can demonstrate circumstances that justify remaining in the U.S. USCIS officials framed the change as a return to the original intent of immigration law, arguing that requiring applicants to process visas abroad would reduce overstays, improve enforcement, and allow the agency to focus resources on other priorities. Critics warn that the shift could disrupt families, increase processing delays that already stretch months or years, and expose applicants to risks such as being unable to re-enter the United States if their applications are denied. The memo marks one of the most consequential recent shifts in U.S. immigration policy, transforming what had long been a common domestic application pathway into a limited exception and making overseas processing the norm for most green card seekers.
Corporate/Sector News
NVIDIA Earnings, Micron, and SK Hynix Hit Trillion Dollar Mark; Anthropic Surpasses OpenAI
The global semiconductor and AI sectors have reached a pivotal milestone as surging demand for artificial intelligence infrastructure continues to reshape valuations across the tech landscape. NVIDIA, already the world’s most valuable company with a market capitalization exceeding $5 trillion, remains the anchor of the AI ecosystem. Its memory chip partners, Micron Technology and SK Hynix, have now joined the trillion-dollar club, reflecting the growing importance of high-bandwidth memory in powering AI data centers. These equities have rallied as investors increasingly look to capitalize on gains across the entire AI supply chain rather than merely from GPUs. Concurrently, Anthropic has raised $65 billion at a $965 billion valuation, surpassing OpenAI’s $852 billion valuation earlier this year. The company’s rapid ascent comes after the widespread adoption of its Claude models, particularly in high-value coding and enterprise automation use cases. Consequently, both AI hard- and software companies are driving markets, signaling a new phase of consolidation and scale in the global AI economy.
Ferrari Goes Electric
Ferrari unveiled its first electric vehicle, the Luce, this week to a deeply polarized reception, sending shares down roughly 8% and sparking a wave of backlash from investors, enthusiasts, and Italian public figures. Priced at €550,000 ($640,000), the four-door, five-seat car was designed by LoveFrom, the agency founded by Jony Ive, Apple’s former design chief, and represents a dramatic departure from Ferrari’s traditional low-slung, two-door silhouette, a consequence in part of the bulkier “skateboard” architecture required by EV battery systems. Critics were swift and pointed: Ferrari’s former chairman Luca di Montezemolo warned the company was “risking the destruction of a legend,” Italy’s Deputy Prime Minister Matteo Salvini questioned what founder Enzo Ferrari would think, and online commenters flooded social media with unflattering comparisons to the Nissan Leaf, a mass-market EV priced roughly half a million dollars cheaper. Ferrari CEO Benedetto Vigna has insisted the car is intentionally “polarizing” and designed to attract new ultra-wealthy buyers, particularly in China, the world’s largest EV market. The rocky debut adds to a broader pattern of struggle in the luxury EV segment, Mercedes-Benz, Porsche, and Lamborghini have all scaled back or abandoned electric plans, and compounds Ferrari’s own trajectory, as the company has already halved its 2030 all-electric target from 40% to 20% of its model lineup. Ferrari’s shares have fallen by roughly one-third since October, erasing nearly $30 billion in market value.
EU Fines Temu €200 Million Over Dangerous Products
The European Union fined Chinese online retailer Temu €200 million ($232 million) on Thursday under its Digital Services Act, marking only the second penalty ever issued under the landmark legislation, following a €120 million fine against Elon Musk’s X platform last year. EU regulators found that Temu, which has between 92 and 130 million users across the bloc since entering the European market in 2023, failed to properly identify and assess the systemic risks of illegal products being sold on its platform, including baby toys containing chemicals exceeding legal safety limits, choking hazards, and electronic chargers that failed basic safety tests. The European Commission’s executive vice president described Temu’s risk assessment as lacking specificity, not grounded in evidence, and leaving regulators and the public “in the dark about the true scale of potential harm.” Temu disputed the fine, calling it disproportionate and arguing that it does not reflect the current state of its systems, while noting it had engaged constructively with the Commission throughout the process. The company has until the end of August to submit a remediation action plan, and faces the prospect of additional daily, weekly, or monthly fines if it fails to comply. Under the DSA, fines can reach as high as 6% of a company’s total worldwide annual turnover, against Temu’s reported revenues of $61.7 billion last year, full exposure would represent nearly $3.7 billion.
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