Market News

Japanese Machinery Orders March 2026 -9.4% m/m

• expected -8.1%
• prior 13.6%

Japanese Machinery Orders 5.9% y/y

• expected 4.5%
• prior 24.7%

---

Japanese Balance of Trade April 301.9bn, a massive beat, and exports blowing past forecast

• expected -29.7bn
• prior 667.0bn

Japanese Imports 9.7% y/y

• expected 8.3%
• prior 10.9%

Japanese Exports 14.8% y/y

• expected 9.3%
• prior 11.7%

Australia's flash composite PMI fell to 47.8 in May from 50.4 in April, signalling the second contraction in three months, as new orders dropped at the fastest pace since September 2021, per S&P Global.

Summary: S&P Global Flash Australia PMI release, May 2026

• The headline composite PMI output index fell to 47.8 in May from 50.4 in April, the second sub-50 reading in three months
• Services business activity dropped to 47.7 from 50.7;
• Manufacturing PMI eased to 50.2 from 51.3, with the output index unchanged at 48.5 for a fourth consecutive month of contraction
• New orders fell at the fastest pace since September 2021, with panel members linking the decline to uncertainty stemming from the Middle East conflict
• Business sentiment was at its…

New Zealand Balance of Trade (Apr) 1.920B

• expected, 0.842B, prior 0.698B

Imports 6.70B

• prior 7.25B

Exports 8.62B

• prior 7.94B

Big beat on the trade balance — more than double the forecast, with exports up and imports down.

UK Chancellor Rachel Reeves will announce free bus travel for children aged five to 15 in England during August and tariff cuts on over 100 food products, in a cost of living package worth around £250 million in total.

Summary: Per Rachel Reeves' parliamentary announcement:

• Children aged five to 15 in England will travel free on participating local buses throughout August, funded by a £100 million government commitment
• Tariff reductions are being sought on more than 100 product types including biscuits, chocolate, and dried fruit and nuts
• The full product list, expected to deliver around £150 million in consumer benefit, is due the following week
• Thursday's parliamentary speech is part of efforts to revive Labour's fortunes following heavy…

• Major US stock indices close sharply higher ahead of Nvidia earnings
• Nvidia earnings after the close. What to expect.
• Labour Wes Streeting is likely to abandon bid for PM and support Andy Burnham
• FOMC Minutes: Many would have preferred to remove easing bias from policy statement
• US sells $16 billion of 20 year bonds at a high yield of 5.122%
• Iran Foreign Minister: Focus is on ending the war and fulfilling Iran's clear demands
• OpenAI preparing to file for an IPO very soon
• Trump: US in final stages in talks with Iran
• Iran News: Foreign Minister says negotiations with the US are ongoing through Pakistan
• Sources: ECB rate hike very likely in June
• Weekly crude oil inventories fall -7.863M vs -2.942M estimate
• Comments from Trump: On Iran, I am in no…

It's a packed agenda ahead. The data most likely to move marekts is the Australian jobs report.

I had a preview here posted yesterday:

• Preview: Australia April jobs data eyed as AUD rally and RBA rate path hang in balance

Nvidia will announce its fiscal Q1 2027 earnings report after the close today, May 20, with Wall Street expecting earnings of $1.78 per share — up 120% year over year ($0.81) — on revenue of approximately $79.2 billion, representing roughly 79.5% growth compared to the same period last year ($44.06 billion). The company itself has guided for $78 billion in revenue, plus or minus 2%, with gross margins expected to hold near 75%.

The Data Center segment remains Nvidia's primary earnings engine, fueled by robust Blackwell platform shipments and surging demand for AI training and inference workloads. Analysts are forecasting Data Center revenue of roughly $72.85 billion, up an estimated 86% year over year. Blackwell now drives close to 70%…

The Times is reporting that Labour Wes Streeting is likely to abandon his bid for PM in favor of Andy Burnham if Burnham wins the Makerfield by-election.

• There is a feeling that no one can beat Andy if he wins the by-election and launches a push to unseat PM Keir Starmer.

Although it is not surly, the trends are that Burnham would be the best candidate.

Iran Foreign Minister is saying:

• Focus is on ending the war and fulfilling Iran's clear demands.
• Tehran's main focus is ending the war on all fronts including Lebanon, releasing frozen assets,and stopping pressing actions and maritime piracy
• Despite the negative record, Iran is pursuing the path of negotiations with seriousness in good faith, but is suspicious of America's performance.

They say that they are currently studying the US's points for peace.

Meanwhile, Pres. Trump says that oil from Venezuela is coming to Texas/Louisiana/Alaska.

• Iran will not have a nuclear weapon
• More fighting to come unless Iran gets smart.

I don't know if the gap is narrowing, but the markets seem to think if there is more bombing, it would be short-lived…

• High yield 5.122%
• WI level at the time of the auction 5.122%
• Tail 0.0 basis points
• Bid to cover 2.55X
• Directs 22.94%
• Indirects 67.67%
• Dealers 9.39%

The dealer takedown was less than the 6-month average of 11.1%. The Bid to cover was a little lower than the average at 2.62x but the international demand saved the day with 67.67% vs 6-month average at 63.5%.

AUCTION GRADE C+

The WSJ is reporting that OpenAI is preparing confidential IPO paperwork, setting up what could become one of the biggest and most closely watched tech offerings in years. Reports say the company is working with Goldman Sachs and Morgan Stanley, with a possible filing coming within days and a public debut targeted as early as September.

The move follows a legal victory over co-founder Elon Musk, although the company still faces questions about profitability, heavy AI infrastructure spending, and rising competition from Anthropic. CEO Sam Altman is leading the company toward what could become a defining IPO for the AI era.

Key points:

• OpenAI preparing confidential IPO filings
• Filing could come within days
• Public debut may happen as early as…

The Iranian Foreign Minister is speaking and says:

• The negotiations are ongoing through Pakistan intermediary
• On uranium transfer, says "why should Iran transfer its enriched uranium to another country? "
• Says that no one was worried about our nuclear program
• Everyone knows that our nuclear program is 100% peaceful.
• Says they do not want demands, but want rights.

The Pakistan Army chief may visit Iran tomorrow to announce the completion of the final version of the text of the agreement

Speaking earlier, President Trump said the U.S. would “give this one shot” regarding Iran negotiations and emphasized that he was “in no hurry,” signaling a willingness to allow diplomacy more time while still maintaining pressure. He added that Israeli Prime…