May 2026 - Taking Stock

May 21, 2026May 21, 2026

Nvidia’s latest figures continue to shape AI mood – May 2026

Nvidia’s latest figures have once again reshaped the mood of global markets, reinforcing its position as the defining force of the AI investment cycle.

The company reported another quarter of exceptional revenue growth, driven by unrelenting demand for its data‑centre GPUs and the rapid rollout of next‑generation Blackwell systems.

Elevated expectations

Sales and profits both exceeded already‑elevated expectations, underscoring how deeply Nvidia’s hardware is now embedded in cloud infrastructure, sovereign AI projects, and enterprise adoption.

The immediate market reaction was sharp. Nvidia’s shares jumped at the open, extending a rally that has already made it the world’s most valuable listed company.

The surge briefly pushed its valuation further into uncharted territory, with traders describing the stock as both “unstoppable” and “structurally bid” due to long‑term AI spending commitments from hyperscalers.

Options activity spiked as investors positioned for continued volatility, while short sellers once again retreated.

Broad impact

The broader market felt the impact too. The S&P 500 and Nasdaq both moved higher, lifted by the gravitational pull of Nvidia’s results and renewed confidence in the AI supply chain.

Semiconductor peers such as AMD, Broadcom, and TSMC saw sympathetic gains, while AI‑exposed software names rallied on expectations of stronger infrastructure investment.

Yet the enthusiasm comes with a familiar caveat. Nvidia’s dominance now exerts an outsized influence on index performance, and any future stumble—whether from supply constraints, competitive pressure, or a slowdown in AI capex—would reverberate across global markets.

For now, though, the company remains the engine powering the bull case for technology and all AI follows.

May 18, 2026May 20, 2026

Why is UK Politics in such a Shambles?

Britain has ripped through five prime ministers in just over five years — Theresa May, Boris Johnson, Liz Truss, Rishi Sunak, and now the prospect of yet another change.

It is not simply bad luck or a run of flawed leaders. It is the visible symptom of a political system that has lost focus and direction.

Conservative infighting to Labour back biting!

The core problem is structural volatility. The UK’s unwritten constitution relies heavily on norms, restraint and party discipline. Over the past decade, those stabilising forces have collapsed.

Brexit

Brexit detonated the old Conservative coalition, splitting MPs into factions that no longer share a common project. Once a party becomes a collection of tribes, leadership becomes temporary management rather than authority.

Prime ministers are installed not to govern but to contain internal warfare — and they are removed the moment they fail to do so.

Exhaustion

The second driver is institutional exhaustion. Westminster has been running in crisis mode since 2016: Brexit negotiations, minority government, pandemic, inflation shock, energy crisis, geopolitical instability.

The machinery of state has been asked to deliver transformation while simultaneously firefighting. That combination breeds short-termism. Policies are launched for headlines, not outcomes.

Leaders are judged by weekly polling, not national strategy. The result is a political class that behaves like a boardroom under siege — reactive, brittle, and constantly reshuffling the chief executive.

Disillusioned

A third factor is public disillusionment. Trust in politics has fallen to historic lows. Voters now punish governments faster and more aggressively than at any point in modern British history.

The electoral cycle has shortened psychologically: every scandal becomes existential, every by‑election a referendum on the prime minister’s survival.

This creates a feedback loop where MPs panic, parties fracture, and leaders lose authority long before the public formally removes them.

Gap

Finally, the UK faces a governance gap. The country has major structural problems — weak productivity, regional inequality, an overstretched NHS, fragile public finances — but no long-term political consensus on how to fix them.

Without a shared national direction, governments drift, parties implode, and leadership churn becomes inevitable.

Britain’s political chaos is not random. It is the predictable outcome of a system that has lost coherence, a governing party that has lost unity, and a public that has lost patience. Until those three forces stabilise, the revolving door at No. 10 will keep spinning.

Just look at the calibre of politicians in the UK – or lack thereof.

I rest my case.

The self-destruct button is being pressed yet again…

UK politicians – it’s time to grow-up.

Definition of politician

A person who is professionally involved in politics, especially someone who holds or seeks public office in government.

More broadly, it refers to anyone who participates in governing, policy‑making, or political leadership at local, national, or international level.

Three words immediately jump out at me: professional, govern and leadership.

I see very little of any of these right now in our political ‘elite’.

May 13, 2026May 20, 2026

Fracking – Oil Exports – and the U.S. Oil Success

One of the least‑discussed forces helping to shape the current U.S.–Iran confrontation is the quiet revolution beneath American soil.

Over the past decade, hydraulic fracturing transformed the United States from a vulnerable energy importer into the world’s largest oil and gas producer.

Pumped up

Nowhere has this shift been more dramatic than in Texas, where the Permian Basin alone pumps more oil than many OPEC members. This surge has not only reshaped global markets — it has altered Washington’s strategic outlook.

The United States now exports record volumes of crude oil and liquefied natural gas, with outbound shipments regularly exceeding 4 million barrels per day.

The conflict with Iran isn’t impacting oil production in the U.S.—if anything, it has boosted output and increased overseas sales.

This would have been unthinkable twenty years ago, when U.S. foreign policy was constrained by dependence on Middle Eastern supply.

U.S. Shale Boom

Today, the shale boom has given Washington a buffer: even severe disruption in the Strait of Hormuz would no longer threaten the U.S. economy in the way it once did.

This energy independence has had political consequences. Analysts note that President Trump’s willingness to escalate against Iran — including strikes, sanctions, and naval deployments — is partly rooted in the belief that the U.S. can withstand an oil shock far better than its rivals.

Iran, by contrast, relies heavily on oil revenues and is already weakened by sanctions. A prolonged disruption to its exports hurts Tehran far more than Washington.

Texas fracking plays directly into this dynamic. The combination of horizontal drilling, high‑pressure fracturing, and vast shale formations has created a production engine capable of rapid growth.

When global prices rise, U.S. shale responds within months, softening the blow to consumers and limiting the geopolitical leverage of traditional producers.

Texas Asset

In effect, the Permian Basin has become a strategic asset — a domestic shock absorber that reduces the economic risks of confrontation abroad.

Critics argue that this new confidence borders on complacency. A major conflict in the Gulf would still send global prices sharply higher, with knock‑on effects for inflation, supply chains, and allied economies.

But there is no doubt that the fracking boom has changed the psychology of U.S. power. For the first time in modern history, America can contemplate a showdown in the Middle East without fearing an immediate energy crisis at home.

Texas may not be the reason the U.S. is confronting Iran — but it has certainly made the White House feel far safer doing so.

May 12, 2026May 12, 2026

Bank busting figures as profits pile up!

Banks are reporting unusually strong profits because higher interest rates have widened margins, while slow pass‑through to savers, cost‑cutting, and capital optimisation have amplified returns — even as credit risks begin to rise.

Why profits are so high

The latest figures show that UK banks are still benefiting from the long tail of the interest‑rate cycle.

Even though the Bank of England has not raised rates since August 2023, the base rate remains at 4.5%, allowing lenders to earn significantly more on mortgages and credit than they pay out on deposits.

This margin expansion has been the single biggest driver of profit growth. Research from recently highlighted from Positive Money shows that the UK’s four largest banks have generated £136.8 billion in pre‑tax profits since rate rises began in December 2021, and are on track to exceed their record £45.9 billion made in 2024 by around 14% in 2025.

A second factor is the government’s interest payments on central bank reserves. Because commercial banks are paid the base rate on their risk‑free deposits at the Bank of England, they stand to receive around £30 billion a year in transfers through to 2030 — effectively a public subsidy that boosts earnings without requiring additional lending.

Banks have also been aggressively returning capital to shareholders. Between 2022 and 2024, the big four spent £42 billion on dividends and £32 billion on share buybacks, reinforcing the perception that profits are being harvested rather than reinvested.

How banks are sustaining these profits

The profitability story is not just about rates. Structural shifts are helping banks defend margins even as the rate cycle turns.

1. Slow deposit repricing High Street banks have been reluctant to raise savings rates in line with market levels. As consumers move deposits to specialist lenders offering better returns, the big banks still retain a large, low‑cost funding base.

KPMG reportedly notes that high street banks’ share of deposits has only slipped from 84% in 2019 to 80% in 2024 — still dominant enough to preserve cheap funding.

2. Capital optimisation through securitisation Banks are increasingly using Significant Risk Transfer (SRT) securitisations to free up capital and improve return on equity. Securitised loan volumes have grown at a 4% CAGR between 2022 and 2025, allowing banks to recycle capital into higher‑yielding assets.

3. Cost discipline and digital transformation With margins expected to compress as rates eventually fall, banks are pushing cost‑cutting, automation, and AI‑driven process redesign.

KPMG reportedly forecasts sector‑wide returns on equity could fall from 18% in 2023 to 10% by 2027 without structural change — making efficiency programmes essential to sustaining profitability.

The emerging risk: impairments

Barclays’ latest results show rising credit impairment charges, including an £823 million provision linked to mortgage‑market stress and fraud‑related losses.

This raises the question of whether the credit cycle is turning. If impairments rise across the sector, the profit boom could fade.

The biggest emerging credit risks sit outside the banking system and that is private credit, leveraged borrowers, and liquidity mismatches that could spill back into banks.

Private credit is now large, interconnected, and showing signs of strain. Rising defaults, deteriorating loan quality, and withdrawal caps at major funds point to mounting stress. Defaults could climb sharply, with Morgan Stanley reportedly warning they may reach 8%, far above historical norms.

A second risk is liquidity pressure. Funds are restricting redemptions as investors rush for the exit, exposing the fragility of semi‑liquid structures.

Finally, contagion risk is growing because banks finance private‑credit funds and pipelines. As analysts note, deeper interconnections mean a downturn could transmit stress back into the regulated system.

Conclusion

Banks are reporting strong profits because the rate environment, public transfers, and capital strategies have created a uniquely favourable backdrop.

But the model is fragile: as impairments rise and rates eventually fall, the sector may be approaching the end of its profit‑supercycle.

May 11, 2026May 11, 2026

Nothing to see here… Nasdaq – S&P 500 and Nikkei 225 each break all-time record highs and set new intraday highs… again!

Global equity markets delivered a remarkable synchronised milestone on Friday, as the Nikkei 225, Nasdaq Composite, and S&P 500 each registered fresh all‑time highs, underscoring the strength of the ongoing technology‑led rally and a renewed wave of risk appetite.

Nikkei

In Tokyo, the Nikkei 225 briefly surged to a record intraday high of 63,385.04, propelled by powerful follow‑through from Thursday’s post‑holiday catch‑up rally. Although the index later eased into modest profit‑taking, it still finished at 62,713.65, comfortably within record territory.

AI here we go!

Semiconductor and AI‑linked names continued to dominate flows, reflecting Japan’s deep integration into the global chip supply chain.

Nasdaq

Across the Pacific, Wall Street delivered a similarly emphatic performance. The Nasdaq Composite pushed to a new intraday peak of 26,248.62 before closing at 26,247.08, its highest level on record.

Strong earnings from major technology firms, combined with renewed optimism around US–Iran de‑escalation efforts, helped extend the index’s multi‑week winning streak.

S&P 500

The S&P 500 also broke new ground, touching an intraday high of 7,401.50 and settling at a record close of 7,398.93.

Each indices continued to hit even higher intraday records after the bell on Friday 8th May 2026.

A stronger‑than‑expected US jobs report reinforced confidence in the resilience of the American economy, even as geopolitical tensions and elevated energy prices continue to shape market sentiment.

Tech cycle

Taken together, the simultaneous records across the U.S. and Japan highlight the dominance of the global technology cycle and the market’s willingness to look through near‑term macro risks.

For now, momentum remains firmly on the side of the bulls. Nothing appears to be able to knock this bull off course.

May 8, 2026May 8, 2026

Private credit – Banks Say “Contained” — Markets Aren’t So Sure

Private credit has become the fault line running beneath the banking system. And it’s now large enough to matter, opaque enough to worry investors, and now visible enough that banks can’t wave it away.

Complicated picture

European lenders spent this earnings season insisting their exposures are “well diversified” or “immaterial”, yet the numbers tell a more complicated story.

Barclays alone reportedly disclosed £15 billion of private‑credit exposure, part of a much larger £66 billion book tied to non‑bank financial intermediaries.

Its hit from the collapse of Market Financial Solutions — a specialist lender undone by alleged fraud — was small in accounting terms, but symbolically important. One cockroach rarely travels alone.

Structural

The deeper issue is structural. Private credit has ballooned into a parallel lending system, lightly regulated and increasingly interconnected with banks through financing lines, securitisations, and business‑development companies.

When these semi‑liquid vehicles face redemption pressure — as several have this year — the stress ricochets back into the banking system. UBS and Deutsche Bank both reportedly emphasised their underwriting standards, but neither disputed that liquidity strains are real.

What unnerves investors is not a wave of defaults — yet — but opacity. Bank of America’s latest survey shows investment‑grade investors are uneasy because they simply cannot see where the risks sit.

Software lending in the U.S., chemicals in Europe, and China‑driven price pressure all add sector‑specific fragility. High‑yield specialists, closer to the coalface, are oddly calmer; they know where the bodies usually fall.

Contained?

The banking system’s official line is that everything is contained. But containment depends on liquidity holding, valuations staying stable, and no further MFS‑style surprises emerging.

Private credit has grown faster than transparency, and faster than the regulatory perimeter. That mismatch — not any single default — is what now shadows the banks.

The issue

The central concern with private credit is simple: it has grown faster than the safeguards designed to contain it.

What was once a niche corner of finance is now a multi‑trillion‑pound shadow banking system whose risks are only partially visible to regulators, banks, or investors. That opacity is now becoming a problem.

Expansion

Private‑credit funds have expanded aggressively by offering speed, flexibility, and looser covenants than traditional banks. In a low‑rate world, that model looked benign. In a high‑rate world, it looks fragile.

Many borrowers were underwritten on assumptions that no longer hold: stable cashflows, cheap refinancing, and buoyant valuations. As rates stay elevated, those assumptions are breaking down.

Defaults

Defaults are rising, and recovery values are uncertain because loans are bespoke, illiquid, and rarely traded.

Liquidity

Liquidity is the second fault line. Private‑credit vehicles promise semi‑liquid access to investors while holding assets that cannot be sold quickly without taking a loss.

When redemptions pick up, funds resort to withdrawal gates, side pockets, or emergency financing lines from banks.

That is where the contagion risk emerges. Banks insist their exposures are modest, but they provide leverage, subscription lines, and warehousing facilities to the very funds now under pressure.

A liquidity squeeze in private credit can therefore boomerang back into the regulated system.

Valuation

Valuation risk is the third issue. Because loans are marked to model rather than market, losses can be slow to surface.

That delays recognition, masks stress, and encourages complacency. When reality finally intrudes — through a default, a refinancing failure, or a forced sale — the adjustment can be abrupt.

The final concern is concentration. Private credit is heavily exposed to software, healthcare, and sponsor‑backed roll‑ups. If one of these sectors turns, the losses will not be isolated.

Private credit is not about to collapse as such. But it is large, opaque, and increasingly interconnected — and that combination is rarely harmless.

May 7, 2026May 7, 2026

Tokyo Takes Off: Nikkei Rockets to Record Heights

The Nikkei 225 surged to a fresh all‑time high yesterday, closing at 62,833.84, driven by a powerful combination of easing geopolitical risk, a global tech rally, and a sharp drop in oil prices.

Exceptional day

The Nikkei’s latest record marks one of the most dramatic single‑day advances in its modern history. The index jumped 3,320.72 points, a 5.58% gain, smashing its previous closing high and briefly topping 63,000 intraday.

This explosive move came as Tokyo reopened after the Golden Week holiday, allowing Japanese equities to catch up with global markets that had rallied earlier in the week.

Easing fears

A decisive catalyst was renewed optimism over a potential U.S.–Iran agreement, which eased fears of prolonged conflict and helped unwind the war‑risk premium that had weighed on markets.

Reports suggesting progress in negotiations pushed crude oil sharply lower, with U.S. WTI futures dropping more than 13% at one point.

Nikkei 225

Lower energy prices provided immediate relief for Japan’s import‑dependent economy and boosted investor sentiment across sectors.

AI led rally

The rally was led by semiconductor and AI‑linked stocks, which have been the backbone of Japan’s market strength throughout the year. Companies such as SoftBank and major chip‑equipment makers saw outsized gains as Wall Street’s tech surge spilled over into Asia.

While analysts expect the domestic market to remain firm in the near term, they also caution that geopolitical conditions remain a major concern.

For now, however, the Nikkei’s latest milestone underscores Japan’s position as one of the strongest major equity markets of 2026.

May 6, 2026May 6, 2026

BYD’s EV sales drop for an eighth month in prolonged slowdown

BYD has entered its most prolonged slowdown on record, with April 2026 marking the eighth consecutive month of falling electric‑vehicle sales.

China’s EV champion BYD is facing a decisive shift in its growth story. The company reported 314,100 passenger‑vehicle sales in April, a 15.7% year‑on‑year decline, extending a downturn that has now lasted eight months — the longest in its history.

Weak demand

Although sales ticked up slightly from March 2026, the broader trend is unmistakable: domestic demand is weakening, and the once‑relentless rise of China’s largest EV maker has stalled.

The slowdown reflects the brutal reality of China’s EV market. A wave of new models, aggressive discounting, and rapid innovation from rivals such as Leapmotor, Zeekr, Geely and Xiaomi has intensified competition.

BYD’s core Dynasty and Ocean series — the backbone of its domestic volume — fell 21.2% year‑on‑year, signalling pressure at the heart of its line‑up.

Niche brands mixed

Meanwhile, premium and niche brands delivered a mixed performance: Fang Cheng Bao surged 190%, while Denza dropped 26.9%, and ultra‑luxury Yangwang grew from a small base.

Yet the picture is not uniformly bleak. Overseas sales are booming, hitting a record 134,542 vehicles in April, up 70.9% from a year earlier.

Exports now account for over 42% of BYD’s monthly volume, underscoring a strategic pivot toward global markets as China’s price war erodes margins at home.

From January to April 2026, international sales rose nearly 60%, even as total global volume fell. BYD is targeting 1.5 million overseas sales in 2026, a goal that now looks central to its future.

Profit plunge

Financially, the strain is clear. BYD’s Q1 profit plunged 55%, with revenue down nearly 12% as domestic competition intensified and hardware costs rose.

The company is responding with faster‑charging battery technology, expanded model launches, and a global manufacturing push spanning Brazil, Indonesia, Hungary and Malaysia.

The story of BYD in 2026 is one of divergence: a weakening home market colliding with accelerating global expansion.

The question now is whether overseas momentum can scale fast enough to counter China’s slowdown.

May 5, 2026May 5, 2026

Intel’s latest surge is being described as its best performance in 55 years

Intel has delivered a remarkable turnaround, culminating in what analysts are calling its strongest market performance since the company first listed on the Nasdaq nearly 55 years ago.

Best figures since 1973

In April 2026, Intel’s shares soared 114%, marking the best month in its entire trading history and eclipsing a record that had stood since 1973.

The rally followed a blowout first‑quarter earnings report, where Intel posted $0.29 EPS and $13.58 billion in revenue, both comfortably ahead of expectations.

CPU demand

Demand for CPUs — long overshadowed by GPUs — is resurging as agentic AI systems increasingly rely on CPU capacity for data movement and workflow orchestration. This shift has placed Intel back at the centre of the AI infrastructure race.

While the company is still early in its recovery, the combination of stronger fundamentals, renewed CPU relevance, and investor confidence has produced a milestone month unmatched in over half a century.

May 5, 2026May 5, 2026

Apple posts strong Q2 results as investors look to incoming CEO

Apple delivered a stronger‑than‑expected set of Q2 2026 results, easing market concerns ahead of Tim Cook’s departure later this year.

Revenue

Revenue rose 17% to $111.18 billion, beating forecasts, while earnings per share reached $2.01. Services once again proved Apple’s most reliable growth engine, climbing to nearly $31 billion and helping push gross margin to 49.3%.

Apple’s China revenue for Q2 2026 was reported as $20.5 billion, up from $16 billion a year earlier — a 28 % increase.

Hardware

Hardware performance was mixed: iPhone sales narrowly missed expectations, though Mac, iPad and wearables all came in ahead of consensus. Apple also reportedly authorised a further $100 billion in share buybacks and raised its dividend by 4%.

Constraints

Cook acknowledged ongoing supply constraints driven by the global memory shortage, warning that higher component costs will increasingly shape the company’s outlook.

Investors also heard from incoming CEO John Ternus, who promised an “incredible roadmap” as Apple deepens its investment in AI and prepares for its next phase of product development.

May 1, 2026May 1, 2026

Euro zone inflation jumps to 3% as economic growth almost stalls

Euro zone inflation accelerated sharply in April 2026, rising to 3%, as the bloc’s economy barely grew — a combination that deepens fears of a stagflationary year.

The latest flash estimate from Eurostat shows headline inflation climbing from 2.6% in March, driven overwhelmingly by surging energy costs linked to the U.S./Iran war and the ongoing disruption in the Strait of Hormuz.

Energy

Energy inflation jumped to 10.9%, more than double the previous month’s rate, underscoring how exposed the currency bloc remains to external supply shocks.

Core inflation, however, edged down to 2.2%, offering a small reassurance that second‑round effects — wage‑price spirals — have not yet taken hold.

Growth was anaemic. First‑quarter GDP expanded by just 0.1%, reflecting weak industrial output, fragile consumer confidence, and higher input costs for businesses.

Stagnation

Economists warn that the combination of rising prices and near‑stagnant activity risks pushing the region into a period of low‑growth, high‑inflation pressure.

The figures land just ahead of the European Central Bank’s policy meeting. With inflation above target but growth faltering, the ECB faces a difficult balancing act.

Policymakers are widely expected to hold rates at 2%, wary that tightening into a supply‑driven shock could deepen the slowdown.

For now, the data reinforce a picture of a euro zone squeezed by global energy turmoil and struggling to regain momentum.

May 1, 2026May 1, 2026

Are markets becoming complacent about the U.S. Iran war?

Markets are flashing warning signs that too many investors are still treating the U.S.-Iran war as a temporary disturbance rather than a structural shock.

Brent crude’s brief surge to around $125 a barrel — its highest level in four years — has reignited fears that the conflict’s economic fallout is being dangerously underpriced.

Complacency

Analysts argue that markets are behaving as though a clean resolution is imminent, even as evidence points in the opposite direction.

The core concern is complacency. Oil’s extreme pricing — where near‑term contracts trade at a steep premium to longer‑dated ones — shows traders are still assuming the Strait of Hormuz will reopen soon and that supply chains will normalise.

Yet millions of barrels per day remain blocked, inventories of refined products like diesel and jet fuel are sliding toward crisis levels, and the White House is reportedly weighing further military action.

None of that aligns with the market’s pricing of a quick return to stability.

The disconnect

This disconnect matters because the real economic damage has not yet fully surfaced. As one investment chief notes, the macro impact will “come back into stark focus” if oil stays elevated.

Higher energy costs feed directly into inflation, squeeze corporate margins, and erode consumer spending power. Equity markets have so far shown resilience, but that resilience is built on the assumption that the shock is temporary.

If the conflict drags into far into May 2026 — as several analysts expect — the stagflationary risk becomes harder to ignore.

Stress

The refined products market is already behaving like a stress test. Diesel prices have nearly doubled, and traders warn that refineries will soon be able to “charge whatever they want”.

Even a peace deal would not deliver instant relief: shipping logistics, sanctions decisions, and depleted reserves would take weeks to unwind.

The fear among seasoned investors is simple: markets are pricing for peace while the fundamentals are still pricing for war. Before long, that gap may close — abruptly and painfully.

May 1, 2026May 1, 2026

Wall Street Closes at Fresh Record Highs as AI Tech Stocks Surge

Wall Street ended April on a strong note as both the S&P 500 and the Nasdaq Composite closed at new record highs on 30th April 2026.

Investors pushed major indices higher for a second consecutive session, encouraged by resilient corporate earnings and renewed confidence in the technology sector.

The S&P 500 finished at 7,209, surpassing its previous peak set only days earlier. The Nasdaq Composite also broke new ground, closing at 24,892 after strong gains in semiconductor and cloud‑computing stocks.

Index	Close (30 Apr 2026)	Previous Record Close	New Record?
S&P 500	7,209.01	7,173.91	Yes
Nasdaq Composite	24,892.31	24,887.10	Yes

Market sentiment was buoyed by expectations that the Federal Reserve will maintain its current policy stance, with inflation data showing signs of stabilising.

April’s performance caps a remarkable start to the year for U.S. equities, driven largely by robust demand for AI‑related technologies.

While analysts warn that valuations are becoming stretched, investors appear comfortable extending the rally as earnings continue to justify optimism.