Week ended June 19, 2026: equities head higher (mostly)

Markets ripped on Thursday, the final trading session of the holiday-shortened US trading week.  The signing of an MoU between Iran and the U.S. to reopen the Strait of Hormuz was the catalyst, sending oil prices lower and stocks to the moon.  The MoU is light on substance, but this mattered little to investors who will hang their hat on nearly anything in this bullish environment.  And let’s face it – there’s no finer way to begin a long weekend than having investors back up their trucks and fill them to capacity with risk.  Here’s how markets did last week[, with more detail at the bottom of this update.

The “up and up and up, day after day after day” narrative is getting slightly counterproductive, at least from the perspective of this blog.  What’s the use to think about fundamental analysis, macroeconomic or geopolitical matters, or portfolio construction, when investors can simply load up on stocks and add more at every single dip?   Ah…..it’s all so predictable and boring.  Therefore, I wanted to talk about something more interesting at the moment – sports.  Let me begin this diatribe by saying I am not a Knicks fan, an Arsenal fan or a PSG fan.  So this is being penned from that perspective.

I have to start by congratulating fans of the New York Knicks, who revelled in the team’s first NBA title in 53 years.  Yikes – that’s 2.5 generations, a long time for any professional team, especially in a market the size of New York City, to be without silverware.  Along this same theme, I owe a similar congratulations to Arsenal fans since the Gunners convincingly claimed the EPL title this year, their first in 20 years, and just missed out on the double in the Champions League Final (vs PSG).  As for PSG, they claimed their second Champions League title in a row a couple of weeks back against the Gunners, with repeat CL winners a rarity too.   This brings us to the World Cup.  It has been an amazing tournament so far, just in its first week.  And in spite of the pre-tournament concerns about logistics and ticket prices, , things seem to have gone very well so far.  Both England and France got off to strong starts, as did the co-hosts USA, Mexico and Canada.  This is one of the most exciting sporting events every four summers.  If markets get you down – which is unlikely unless you’re short equities or loaded up on long-duration bonds – switch off markets and switch on the World Cup!

With that diversion out of the way, this past week brought:

• Major central bank decisions as expected (Fed and BoE held, BoJ increased policy rate 25bps),

• A MoU between Iran and the USA, which settled global oil markets and encouraged investors to strap on more risk,

• SpaceX (SPCX) increasing 42% in the (US holiday) shortened week, at one point surpassing AMZN’s market cap, and

• An uneventful G7 meeting, largely a choregraphed “much-to-do-about-nothing” session.

US-Iran MoU

Let’s start with the MoU between Iran and the USA, which should reopen the Strait of Hormuz.  Pundits and politicians are all over the place on exactly what this relatively short 14-point agreement (from the #BBC) really means for both countries, because it lacks details that are to be worked out in the coming 60 days.  It doesn’t seem to me that the US accomplished the objectives clearly stated by the Administration at the start of the conflict, which you can find on The White House website here (dated April 1, 2026, prior to President Trump’s update speech).  I suppose time will tell, in that the two sides have 60 days to put some “meat on these bones.”  This is a topic I shall steer clear of in this blog.  Although pundits continue to debate which country “won” the war, what is crystal clear is that markets have benefited from the fact that oil will be flowing again soon through the Strait of Hormuz. WTI crude oil was down around 10% WoW.  According to AAA, the average cost/gallon of gasoline (petrol) in the USA has fallen 12.4% in the last month and is currently back below $4/gallon, just in time for summer travel.

Central bank decisions

There is nothing earth-shattering here aside from the subtleties that investors were able to gain during new Fed-chairman Kevin Warsh’s post-FOMC press conference.  I listened to Mr Warsh’s comments, and found him very credible and convincing, mainly because he acknowledges that the major challenge facing the Fed at the moment is severely above-target inflation.  The bond market reacted by sending short-term yields higher, and long term yields lower, as the 2-10 year yield curve narrowed to its tightest level since 1Q2025.  If you are interested, you can watch the post-FOMC decision statement and press conference here, or read the transcript here.

SpaceX: the aftermath

With the IPO of SpaceX (SPCX) pricing at $135/share late last week, the shares headed higher most of the week, reaching an intraday high on Wednesday of $225.64/share.  Forgive me for saying this, but that’s just stupid.  At one time last week, the market cap of SpaceX – a company with $19 billion of revenues and a loss of $8.8 billion in the last 12 months – exceeded the market cap of Amazon (AMZN), a company with $743 billion of revenues and $90.8 billion of earnings.  SPCX started to fade on Wednesday afternoon though, and ended the week at $191.82/share.  A gain of 42% in its first week isn’t bad, although the question remains: does this stock have legs?  

MARKET DATA AND TABLES

Below are tables of key indices and asset prices that have been updated for the past week, through mid-afternoon Friday (a US holiday).

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