Global markets are showing renewed energy midweek, fueled by Nvidia’s continued AI surge, record-setting crypto inflows, and signs of easing U.S.–China trade tensions. As traders await the ECB’s policy decision and key U.S. inflation data, the mix of optimism and caution is setting the stage for a pivotal shift in market sentiment. Let’s dive into our mid-week recap in other to stay ahead of market movements for the rest of the week.
AI Stocks Maintain Leadership as Nvidia Nears Record Highs
Nvidia remains the poster child of the AI-driven equity rally, with its stock now within 5% of its all-time high set in January. Renewed investor optimism stems from anticipation surrounding CEO Jensen Huang’s keynote at a Paris AI forum, and Nvidia’s expanded role in Europe’s new Blue Lion supercomputer project alongside HPE and the Leibniz Centre.
Despite looming concerns over U.S. chip export policy, the AI narrative remains dominant, reinforcing the sector’s role as the engine of global equity momentum.
Midweek Recap: Crypto Inflows Accelerate as Digital Assets Go Institutional
May set a new record in crypto assets under management, hitting $167 billion on the back of $7.05 billion in monthly inflows. Bitcoin has pushed above $109,000, while Ethereum ETFs attracted $437 million in midweek flows—underscoring how digital assets are becoming core components of institutional hedging strategies.
Momentum is no longer retail-driven. With Bitcoin strength and ETF adoption rising, crypto’s correlation with macro themes—from inflation to liquidity—continues to tighten.
U.S.–China Trade Truce Gains Momentum, But Markets Stay Cautious
Trade tensions eased slightly as the U.S. and China outlined a preliminary agreement around rare earths and tariff cooperation during a meeting in London. While Asia-Pacific equities reacted positively, U.S. futures were flat—signaling that investors want concrete implementation before shifting allocations.
Markets have been here before. Optimism is rising, but traders remain acutely aware of how quickly rhetoric can reverse.
ECB in Focus Ahead of June 12 Decision
The European Central Bank’s next policy announcement is scheduled for Thursday, and expectations lean toward no major rate change. However, any adjustment in forward guidance could shift sentiment, especially now that global trade tensions appear to be cooling.
With the eurozone still navigating low growth and geopolitical pressure, any surprise dovishness could revive appetite for European equities and bonds.
Midweek Recap: U.S. Labor Data and CPI: A Complicated Mix for the Fed
Ahead of Friday’s inflation print, economists are eyeing unusual labor dynamics. Declining immigration inflows are distorting payroll data, making it harder to interpret recent softness.
This labor fog clouds the Federal Reserve’s policy path. If CPI remains soft and labor remains tight, markets may push back expectations for rate cuts—but data clarity is critical.
Midweek Recap: Key Themes to Watch
- AI vs. Policy
Nvidia’s continued strength keeps AI at the forefront—but how long can this rally hold if trade friction resurfaces? - Crypto as Hedge
Institutional capital is pouring into digital assets. Not yet fully mainstream—but no longer fringe either. - Trade Meets Central Banks
A fragile truce and central bank caution define this week. What comes next could reshape Q3 positioning.
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