Market Review: May 21, 2026

Closing Recap

Thursday, May 21, 2026

U.S. stocks remain on track for an 8^th straight week of gains as a late day report that the final draft of the US-Iran agreement has been reached with the mediation of Pakistan, which is expected to be announced within the next few hours, as per Al-Arabiya lifted stocks into positive territory. Those headlines pushed stocks higher across the board as breadth dramatically improved (nine of eleven S&P sectors closed higher) and sent Treasury yields and oil prices lower, adding to the euphoric feel on Wall Street surrounded by better results and guidance from AI chip giant NVDA last night, which had already boosted shares of the AI supply chain prior (data centers and infrastructure along with chips and power, cooling plays). Utilities, Materials, Consumer Discretionary led higher while Energy and Consumer Staples fell.

More on the report of agreement: The final draft of the US-Iran agreement has been reached with the mediation of Pakistan, which is expected to be announced within the next few hours – Al-Arabiya reported. This draft includes an immediate and comprehensive ceasefire on all fronts. The Parties mutually undertake to refrain from targeting infrastructure. Freedom of navigation in the Persian Gulf and the Strait of Hormuz is guaranteed under a Joint monitoring mechanism. Sanctions will be gradually lifted in exchange for Iran’s compliance with the terms of the deal. Negotiations on outstanding issues shall begin within a maximum of seven days.

In stock sector news, NVDA results helping lift the AI data center/infrastructure sector along reports of price increases for NBIS; hospital stocks (THC, UHS, HCA) slide on CMS headlines overnight; luxury retail rises on RL results while WMT declines on in-line results and soft guidance; quantum stocks IBM, GFS, RGTI, INFQ, QBTS rising on U.S. investment/stake headlines (see below) – but overall group surged. Overall, a very busy morning of news, including IPO fever with SpaceX providing details of its upcoming planned IPO with a valuation of $2 trillion, just a few days after reports ChatGPT-maker OpenAI has been working with bankers to prepare to file for an initial public offering in the coming days or weeks

It was a case of “He said, he said” all day: It started this morning with a Reuters report that Iran’s Supreme Leader Mojtaba Khamenei has issued a directive that the country’s highly enriched uranium should not be sent abroad. Israeli officials also said that ‌President Trump has assured Israel that any peace deal must include a clause removing Iran’s highly enriched uranium from the country (shares fell). Later, a senior Iranian official denied claims that Supreme Leader Mojtaba Khamenei issued an order requiring enriched uranium to remain inside Iran, calling the reports “enemy propaganda.” (shares bounced). Later were reports that the final draft of the US-Iran agreement has been reached with the mediation of Pakistan, which is expected to be announced within the next few hours, as per Al-Arabiya (stocks bounced further). Then stocks fell on yet ANOTHER headline from Iranian State TV saying that Iran President says he won’t back down in talks (as stocks dipped late). Incredible that every headline moved markets all day!

In Weekly Sentiment data: 1) The bull-bear spread in the American Association of Individual Investors (AAII) weekly survey was 11 11.9% vs +2.7% last week. Bulls fall to 31.7% from 39.3%, Neutrals rise to 24.7% from 24.1%, Bears rise to 43.6% from 36.6%. 2) This week’s NAAIM Exposure Index ticked higher to 82.02 from last week’s 77.34 – recent hi of 96.67 from 5/6 – the 10-29-25 Reading of 100.83 is the 52 week hi – 2025 trough from 4-16-25 of 35.16 – Last Quarter Average (Q1) was 82.00 (down from 92.26 in Q4).

Stat of the day: As technology (AI/chips specifically) continue to pace market gains, @KobeissiLetter notes on X, “The 10 largest US stocks now account for a record 41% of the S&P 500’s market cap. This is 14 percentage points higher than at the 2000 Dot-Com Bubble peak. This means ~41 cents of every Dollar invested in the S&P 500 flows directly into shares of just 10 firms. ~35 cents of every Dollar flows specifically into the Magnificent 7 group. All while nearly 50 cents of every Dollar are now going into Ai-linked stocks.”

• Philadelphia Fed Business fell -0.4 in May below consensus 18.0 and down vs April 26.7; prices paid index for May down to 47.9 vs April 59.3, while new orders index plunged to -1.7 in May vs April 33.0. The employment index fell to -2.8 vs April -5.1and six-month capital expenditures outlook May 30.9 vs April 35.2
• U.S. Housing starts for April declined (-2.8%) m/m to 1.465M annual rate vs. 1.410M consensus and 1.507M prior (revised from 1.502M), Single family starts -9.0% to 930,000 unit rate; multifamily +10.3% to 535,000 unit rate. April Building permits rose +5.8% m/m to an annual rate of 1.442M vs. 1.380M consensus and 1.363M prior.
• S&P Manufacturing PMI Flash Actual 55.3 (Forecast 53.8, Previous 54.5) and S&P Services PMI Flash Actual 50.9 (Forecast 51.2, Previous 51.0).
• Mortgage rates this week rose to the highest level since August, more bad news for home shoppers during what is usually the busiest time of the year for home sales. The average rate on a 30-year fixed mortgage rose to 6.51% this week, from 6.36% last week, Freddie Mac said Thursday.

• June gold prices rose +$7.20/oz, or +0.16%, to settle at $4,542.50 an ounce and July Silver gained $0.55/oz, or +0.72%, to settle at $76.73 an ounce, rebounding this afternoon with stock markets as oil prices and Treasury yields fell on increased prospect of an Iran/US agreement per reports. Prior to the late day move lower for the dollar, The dollar/Japanese yen cautiously sets new weekly high as higher oil on Iran tensions and firm jobless claims lift yields and the dollar.
• Turkey sold nearly all of its US Treasury holdings in March, cutting them from $16 billion to just $1.8 billion, according to US Treasury data. The selloff came as Ankara moved to support the lira during market turmoil triggered by the Iran war. The central bank also sold foreign currency and gold reserves to stabilize the economy.

• Luxury Retail: RL posted Q4 top and bottom line beat ($2.80/$2B vs. est. $2.54/$1.85B), increases quarterly dividend 10% to $1.00 per share on better guidance; sees Q1 revenues to increase in the mid- to high-single digits on a constant currency basis, above consensus of a 6.9% rise and expects annual constant currency revenues to increase by about mid-single digits over last year, centered around 4% to 5%.
• In Beauty Products: ELF reported Q4 sales up +35.1% y/y to $449.3M and vs consensus ests of +27.2% and implied guidance of sales to range between $413-$424M in sales as beat was primarily driven by outperformance from Rhode, which saw sales around ~$112M vs implied guidance of $82-87M. The rest of the business was up around +1%, with core Elf at the low end of the guide, and company talked about volume below expectations QTD.
• Apparel Retail: URBN reported a Q1 beat (EPS $1.30 vs. $1.16), with stronger sales (Free People / Urban Outfitters) alongside modestly better margins driving the outperformance as comp trends remain healthy across banners (total company comps +5.6%), though focus remains centered on the sequential momentum at Anthropologie where comps at 1.9% missed consensus at 2.5%. KTB to sell Lee business to authentic brands group for up to $1B as deal includes $750M initial value and $250M earnout opportunity. BIRK shares jumped following $250M share buyback plan
• Food & Beverages: KR shares slipped after Bloomberg News reported new CEO Greg Foran is looking at big price cuts in order to win back market share and take on competitors like WMT, COST and AMZN and laying the groundwork for lower prices across product categories.

• In Auto & Auto parts/retail: AAP shares rallied as Q1 results beat with quarterly profit and revenue topping estimates ($0.77/$2.61B vs. $0.45/$2.58B consensus), driven by strong growth in its Pro business that serves commercial garages and repair workshops while Fy26 EPS $2.40-$3.10 missed midpoint of $2.76 est. STLA shares declined after revealing its new 60 billion-euro ($70 billion) plan to 2030 leaves investors focused on execution, even as margin guidance topped expectations in several regions, including North America. The strategy update includes plans for 60 new car models by 2030, new technology investments, joint ventures with other carmakers and better use of its manufacturing capacity. STLA expands QCOM partnership and will use Qualcomm Snapdragon Digital Chassis SoCs across cockpit platforms for next-generation vehicles.

• Utilities/Power: AEE was upgraded to Overweight with $126 tgt at JP Morgan saying with data center datapoints piling up, the firm has higher confidence in the company’s growth outlook and see the potential for the EPS CAGR to inflect higher. Power/nuclear plays TLN, CEG, SMR, VST, CEG have seen recent momentum after PJM headlines.
• In Solar, ENPH shares advanced published a technical white paper titled “Enphase Adoption of GaN Bi-Directional Switch Technology for Distributed Power Electronics.” The paper provides an engineering view of Enphase’s adoption of Gallium Nitride High Electron Mobility Transistor Bi-Directional Switch technology, or GaN HEMT BDS

• Financial Payments: FLYW was upgraded to Neutral from Underweight at JP Morgan, leaning more into its positive bias as management’s sharp execution on Re-mixing the business (organically and inorganically) makes FLYW less vulnerable to negative earnings revision risk.
• In Insurance: ALL announced estimated catastrophe losses for April of $870M or $687M, after-tax, from 10 wind and hail events with approximately 70% of the losses related to two events; CB shareholders approve 5.2% dividend increase to $4.08 per share annually and authorized new $7.5B share repurchase program.
• In REITs: AVB and EQR agreed to combine in an all-stock merger in a move that would create a multifamily real-estate giant. Under the terms of the deal, AvalonBay holders would receive about 2.793 shares of Equity Residential common stock for each share held in an agreement that has been unanimously approved by the boards of both companies.

• HIMS said it is now offering Canadians a generic version of semaglutide, the active ingredient in NVO’s blockbuster GLP-1 drugs, through its telehealth platform. The generic drug is made by Apotex Inc, the largest Canada-based global health company, Hims said, marking the platform’s first international generic GLP-1 offering.
• OFIX shares fell after lowering its FY26 revenue view to $838M-$848M from $850M-$860M (est. $854.43M) saying the FDA issued a final order reclassifying non-invasive bone growth stimulators from Class III to Class II devices. In connection with that reclassification, CMS recently updated certain billing requirements and Medicare fee schedule treatment applicable to non-invasive bone growth stimulators billed under certain codes.
• Hospital sector (HCA, UHS, CYH, THC): The Centers for Medicare & Medicaid Services (CMS) proposed today a sweeping crackdown on state Medicaid payment practices that have driven payment rates well above Medicare levels, leading to excessive federal costs. The Medicaid Managed Care State Directed Payments (SDP) and Medicaid Fee-for-Service (FFS) Targeted Practitioner Payments Proposed Rule would set clear caps and better align Medicaid payments with Medicare standards. If finalized, the proposed rule would generate an estimated $775 billion in total savings over 10 years, including $510 billion in federal savings

• Transports: overall sector was mixed, but airlines (AAL, ALK, UAL, JBLU, LUV) saw an afternoon bounce following a slide in oil prices on reports of a near agreement by the U.S./Iran; shares of DAL traded at all time highs;

• RKLB shares fell after announcing filing to sell up to $3B in common stock

• In Chemicals: CC shares fell after news President Trump will announce that his administration is easing restrictions on the potent planet-warming chemicals used in air-conditioners and refrigerators. The move would slow plans to phase out hydrofluorocarbons, synthetic substances sometimes referred to as "super pollutants" because of their enormous effect in driving climate change. NDSN Q2 adj EPS $2.86 vs. consensus $2.82; Q2 sales rose 8% y/y to $740.8M vs. consensus $728.8M; Q2 EBITDA a record of $235M, rising 8% y/y from $217M; raises FY26 EPS view to $11.30-$11.80 from $11-$11.60 (est. $11.45) and boosts FY26 revenue view to $2.93B-$3.01B.

• AMKR is working with AMD on packaging AMD’s chips, Amkor said on Thursday. Earlier this week, Amkor said it had secured 67 additional acres of land in Arizona next to a 104-acre parcel where it is developing a new campus where it plans to start production in 2028 – Reuters.

• Neoclouds/AI Data Centers: NBIS shares jumped on reports the company will raise prices on certain NVIDIA GPU rental platforms, effective June 1, 2026; Roughly ~30% on on-demand (pay-as-you-go) rates across many NVIDIA GPU platforms; Various NVIDIA GPUs including H100/H200 series and newer Blackwell platforms (also saw strength in shares of CRWV). APLD shares jumped after the company announced its fourth major deal (300MW) with the same high-credit customer who recently took capacity in its Delta Forge Location in Louisiana. The deal is valued at about $7.5 billion in base-term contracted revenue.
• Software movers; MSFT shares bounced early before slipping after a report in The Information said Anthropic is in talks to Rent servers powered by Microsoft-designed Ai server chips as it seeks more Computing power to meet rising demand for its Ai, according to two people who spoke to executives involved in the discussion. https://tinyurl.com/3srum9ah ; another day of negative returns for the software sector (IGV) as rotation into AI plays, data centers and chip names continue and rotate out of software seen as impacted by AI developments.
• Media sector: SPOT shares jumped more than 17% after holding its Investor Day; guided mid-teens revenue CAGR by 2030 and sees gross margin 35%-40%, operating margin above 20% by 2030 and surged on news that Spotify and Universal Music struck a deal to let subscribers create AI-generated covers and remixes of songs, marking the first time the audio-streaming giant will allow users to produce AI content using its platform.