Most global bond and stock indices rallied last week, with several global (including U.S.) stock indices closing at record highs. PCE data for April confirmed elevated inflation in the U.S., and the fact that consumers are getting poorer. This is a real contrast with the ever-higher improvement in most global asset prices.

Markets deteriorated further as the US threats amount to nothing more than deferred deadlines as Iran digs in its heels. Higher oil prices and an unclear picture of how this war might play out is rattling nearly all corners of the financial markets.

War breaks out with rather significant effects on the global economy, including sharply higher oil prices and increasing inflation expectations. This filtered through to stocks and bonds, both of which took a beating this week.

Stock and bond markets felt fragile all week. The US Dec jobs report caused investments to gap down in price to end a difficult week.

Earnings and economic data (especially inflation data) continued to improve risk sentiment. The yield curve inversion ended. Dollar better