Financial Markets Daily Report
12 mayo 2026
Yesterday’s session reflected renewed caution over the prospects for a resolution of the Middle East conflict, as negotiations between the US and Iran remained deadlocked, with President Trump describing Tehran’s latest proposal as “totally unacceptable”. Brent settled above $104/barrel and volatility ticked up.
Government bond yields rose on both sides of the Atlantic as expectations of more hawkish central banks increased. Markets are pricing a total of 3 rate hikes by the ECB this year, and a rate hike by the Fed next year. In currency markets, the Japanese yen lost ground against the US dollar, which closed flat against the euro.
Equity markets closed mixed in the euro area, with energy-heavy Portuguese PSI-20 registering gains and most other indices down. US indices rose modestly, pushed up by optimism surrounding AI. Today, investors will be attentive to the release of April inflation numbers in the US.