Macroeconomy and Multi-Asset ETF analysis: Week of 8 June 2026
Macroeconomy
Inflation and growth data painted a mixed but clearly more stagflationary picture, led by war-related energy pressure. North America’s median Q1 GDP growth forecast was revised up to 2.0% from 1.8%, while Japan’s PPI rose 6.3% yoy, China’s exports and imports both surged more than 19% and 27% respectively, and U.S. CPI accelerated to 4.2% yoy with more than half of the monthly gain coming from energy.
Core inflation held up better than headline inflation, but the energy shock still fed through to producer prices and consumer sentiment. U.S. PPI rose 6.5% yoy, core PPI reached 4.9% yoy, the ECB lifted its deposit rate by 25 bps to 2.25%, and the UK economy slipped -0.1% mom, underscoring how the Iran shock was starting to hit activity outside the U.S. as well.
(Geo)Politics
The week was dominated by a fast-moving Iran–Israel escalation that briefly pushed the Strait of Hormuz into the center of market attention before de-escalation and interim peace talk hopes took over. By week’s end, the tone had shifted from war-risk shock to cautious optimism, with reports pointing to a possible deal that could reopen the strait and curb further fallout.
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Iran’s missile volley against Israel, subsequent retaliatory strikes, and the later U.S. self-defense strikes kept geopolitical risk elevated, while competing claims over the Strait of Hormuz closure added volatility to energy markets. President Trump’s late-week reversal and the suggestion that talks were proceeding helped steady sentiment, even as Tehran said it had not made a final decision.
Equity
Global equity markets rallied in sync during the week on optimism US is close to reach a deal with Iran, although a final decision is still not yet made.
Equities were highly rotational, with semiconductors swinging sharply as investors alternated between AI optimism and valuation concern. AI-linked names remained sensitive to rate expectations, capex discipline, and changing views on profitability.
Outside tech, the market showed clearer signs of sector rotation into rate beneficiaries and defensives. Banks (KBWB) rallied on the prospect of wider net interest margins, industrials (XLI) also rallied despite pressured by Amazon’s expansion of large-item shipping, and SpaceX’s first day of trading drew capital away from smaller space names, dragging ETFs like NASA and UFO.
As market sentiment improved, Momentum (SPMO)Â and Small Cap (IJR) outperformed other styles for the week.
Fixed Income
Treasury yields were driven first by risk-off geopolitics and later by relief and higher risk appetite, creating a choppy but ultimately lower weekly tone at the long end. The 10-year yield finished the week below 4.5%. Rate expectations also shifted materially. Interest-rate swaps ended the week pricing a full 25 bps Fed hike by January 2027, reflecting the combination of softer core inflation, falling oil, and the market’s growing belief that the worst inflation shock may not persist if the geopolitical situation stabilizes.
Commodity
Oil (USO, BNO) and gold (GLDM) were the clearest real-time barometers of the conflict. Oil fell to the lowest since early March as talk of a deal gained traction, while gold moved from around $4,300/oz to near $4,100 before stabilizing near $4,200/oz by Friday. War risk initially lifted energy and safe havens, but the market quickly shifted toward pricing de-escalation. Gold still ended under pressure in year-to-date terms after trading more than 20% below its all-time high, suggesting that the combination of higher real yields and easing conflict fears outweighed the initial haven bid.
Currency
The dollar strengthened when the crisis intensified, then retreated as sentiment improved and yields eased. Bitcoin held above 63,000 but remained sharply down year-to-date, still struggling to regain durable momentum even as some of the week’s geopolitical stress began to fade.
The Week Ahead
US: May Industrial Production
Europe: UK/Eurozone May CPI
Japan: May CPI
China: May Industrial Production