Global markets

From Friday 1 May 2026 to Friday 8 May 2026, global equity markets posted a broad-based advance, extending a six-consecutive-week rally. The MSCI ACWI rose 2.4% led decisively by the growth factor: MSCI AC World Growth surged 3.6% against MSCI AC World Value's 1.4% gain, reaffirming the AI and semiconductor cycle as the dominant market theme of 2026.

Three forces drove the week. Post-earnings momentum from the Magnificent Seven sustained upward estimate revisions and amplified enthusiasm for AI capital expenditure. Geopolitical developments around the Strait of Hormuz provided a further tailwind: reports mid-week that the US had suspended its 'Project Freedom' naval escort operation, citing progress in negotiations with Iran, sent Brent crude sharply below USD 100 per barrel. A partial re-escalation late in the week capped the oil price move, but crude remained firmly negative on the week, relieving pressure on inflation-sensitive equities. Finally, US nonfarm payrolls for April came in at 115,000, well above the 55,000 consensus and the first back-to-back monthly gain in nearly a year, with the unemployment rate steady at 4.3% and year-on-year wage growth a contained 3.6%.

Technology was the clear global outperformer: the S&P Technology Select Sector gained 8.5%, driven by strong rallies across semiconductors and cybersecurity names. Energy was the principal laggard, with the S&P Energy Select Sector off 5.3% on collapsing crude prices. Utilities fell 3.9% as the risk-on tone reduced appetite for defensive positioning.

US

US equities posted their sixth consecutive weekly gain, with the S&P 500 up 2.4% and the Nasdaq 100 surging 5.5% as markets recalibrated to an AI-driven earnings growth path. The S&P 500 Equal Weighted index rose only 0.7%, confirming that the advance remained concentrated in mega-cap growth names. The Russell 2000 and S&P Mid Cap 400 each added 1.7%, pointing to modest broadening beneath the headline.

Semiconductors dominated sector performance: the SOX index gained 11.7%, driven in part by AMD's strong first-quarter results. Cybersecurity also outperformed, with the Global X Cybersecurity ETF up 13.9%, reflecting the view that accelerating enterprise AI adoption is directly supportive of cloud-security spending. Financials were the notable drag, with the S&P Financial Select Sector down 1.3% (banks -3.1%, insurance -1.6%), partly reflecting policy uncertainty following the 29 April FOMC decision. The Fed held rates unchanged at 3.50%-3.75% in an 8-4 vote, the most dissents since 1992, with three regional presidents objecting to the statement's easing bias. Chair Powell confirmed he would remain on the Board after Kevin Warsh assumes the chair, expected following a full Senate vote the week of 11 May. The stronger-than-expected payrolls print reinforced the case for an extended pause.

Equity asset class

We have slightly increased our equity exposure but remain neutral overall, as geopolitical risks and volatility are likely to persist. In this context, we have raised Europe to market weight and slightly increased our exposure to Japan and emerging markets.

Earnings

The outlook has become more constructive, with a prolonged conflict now appearing less likely. Crude oil prices have eased, and natural gas - particularly relevant for Europe - has declined back toward its average levels of the past three years. 2026 EPS forecasts have been revised up and point to solid growth: approximately +22% for the S&P 500, +16% for the STOXX Europe 600 and +11% for MSCI Japan.