Markets Pull Back As Oil, Yields, And Geopolitics Rattle Confidence

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[Chart courtesy of MarketWatch.com]

  1. Moving the market

Stocks came under pressure right out of the gate as rising oil prices and climbing Treasury yields rattled investors.

The concern? Ongoing tensions between the U.S. and Iran could keep inflation elevated for longer than expected. Oil moved higher after both countries launched new strikes, with Kuwait reporting overnight that its air defense systems were intercepting “hostile targets.”

Adding to the drag, AI-related names—recent market darlings—took a breather. Nvidia slipped more than 2%, while Dell and Oracle dropped about 5.5%. Microsoft wasn’t spared either, losing around 2%. After such a strong run fueled by optimism and heavy investment in the AI cycle, a pause here isn’t all that surprising.

In fact, the timing makes sense. We’re moving past earnings season, which has been a major tailwind, so a bit of cooling off—or even some added volatility—feels natural as we head into the quieter summer months.

On the economic front, things are a bit mixed. Strong ADP jobs data and solid Services PMI pushed the U.S. Macro Surprise Index to its highest level since September 2023.

Normally that would lift sentiment, but instead it seemed to confuse traders. Yesterday’s bullish momentum quickly gave way to today’s reality of rising oil prices and higher bond yields.

The S&P 500’s 9-day winning streak came to an end, with all major indexes closing lower. Small caps led the decline, while the S&P held up relatively well. The “Mag 7” continues to struggle this week, significantly underperforming the broader S&P 493.

Elsewhere, bond yields spiked, and the dollar strengthened, putting pressure on gold, which slipped again. Bitcoin didn’t offer much refuge either, with sellers pushing it down toward key support levels as ETF outflows continue.

What we’re seeing looks like an extreme positioning shift—money chasing AI stocks while flowing out of gold and crypto, fueling pockets of speculation. The big question is: how long can that imbalance last before something gives?

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Stocks Hold Near Highs While Geopolitics And Weak Breadth Raise Eyebrows

Ulli Market Commentary Contact

[Chart courtesy of MarketWatch.com]

  1. Moving the market

The S&P 500 was pretty flat early on, as traders took a breather after hitting fresh all-time highs and kept an eye on the latest headlines around U.S.–Iran tensions—along with the usual moves in big tech.

Tech itself was a bit mixed. Alphabet slipped about 1%, but Nvidia helped pick up the slack, climbing 1% and keeping the sector from sliding.

The real standout, though, was Hewlett Packard Enterprise, which surged 26% after delivering a strong outlook and raising full-year guidance well above expectations.

Looking back, Monday’s record highs were largely driven by Nvidia and the ongoing enthusiasm around the AI trade. It’s been an incredible run for equities lately—fast and powerful.

Of course, those kinds of moves can sometimes unwind just as quickly, but for now, traders aren’t seeing red flags from their overbought/oversold indicators.

On the economic front, job openings jumped, giving the Macro Surprise index a boost, while the number of people quitting their jobs dropped sharply.

Add in generally upbeat earnings, and that helped keep the market in positive territory—even as headlines about a potential U.S.–Iran deal remained mixed.

That said, there were a few signs under the surface worth noting. The S&P 500 didn’t quite confirm moves in crude oil or bond yields, small caps actually outperformed, and overall market breadth stayed weak—which can sometimes hint at a less healthy rally.

Elsewhere, bond yields were mixed, the dollar edged a bit lower, and gold gave back its overnight gains but still managed to finish slightly higher. Bitcoin, meanwhile, lost momentum and tested the $66K level, hitting two-month lows.

Oil has been especially volatile, swinging on uncertainty around the ceasefire and concerns over shipping through the Strait of Hormuz. Prices had dropped last month on hopes for a deal, but the outlook now feels a lot less clear.

Adding to the confusion, recent comments from Trump and Israeli Prime Minister Netanyahu didn’t exactly line up, leaving traders with more questions than answers.

With all this crosscurrent of strong momentum, weak breadth, and geopolitical uncertainty—how long can the market keep pushing higher without a clearer direction?

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Indexes Grind Higher As Traders Navigate Oil Shock And War Headlines

Ulli Market Commentary Contact

[Chart courtesy of MarketWatch.com]

  1. Moving the market

Oil prices jumped about 8%, but the broader market didn’t seem too rattled—at least at first. The major indexes hovered near flat in early trading, with Nvidia helping to lift tech after rolling out a new PC chip.

A lot of that tension is tied to escalating headlines out of the Middle East. Iranian state media said negotiations with the U.S. have stalled, and there were even threats to shut down the Strait of Hormuz following Israeli attacks in Lebanon.

At the same time, the situation on the ground kept intensifying, with U.S. forces reportedly intercepting Iranian missiles aimed at bases in Kuwait overnight.

Back in the market, Nvidia gave stocks a bit of a tailwind, climbing more than 3%. That momentum spilled over into PC-related names like Dell and HP, while Intel went the other way, dropping over 4% as competitive pressure showed up again.

By the afternoon, things got a lot choppier. Headlines were flying, bond yields and the dollar moved higher, and talk surfaced that U.S.–Iran negotiations might actually be back on.

Markets reacted in real time, with asset prices swinging and, interestingly, the mega-cap “Mag 7” names fading late in the session to finish roughly in line with the rest of the S&P 500.

In other corners, gold extended its pullback from Friday but managed to hold near the $4,500 level, while Bitcoin slid toward $70K—its lowest point since early April.

All in all, it was another mixed, headline-driven session. Traders stayed nimble, reacting quickly to shifting oil and geopolitical news, and the major indexes still managed to squeeze out a modest gain by the close.

The big question now—how long can the market keep brushing off this kind of uncertainty?

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ETFs On The Cutline – Updated Through 05/29/2026

Ulli ETFs on the Cutline Contact

Do you want to know which ETFs are hot and which ones are not? Then you need my High-Volume ETF Cutline report. It tells you how close or far each of the 311 ETFs I follow is from its long-term trend line (39-week SMA). These are the ETFs that trade more than $5 million a day, so they are not some obscure funds that nobody cares about.

The report is split into two parts: The winners that are above their trend line (%M/A), and the losers that are below it. The yellow line is the line of shame that separates them. You can see how many ETFs are in each group and how they have changed since the last report (218 vs. 231 current).

Take a peek:

The HV ETF Master Cutline Report

If you are confused by some of the terms we use, don’t panic. I have a helpful Glossary of Terms for you.

If you want to learn more about the Cutline method and how it can make you rich (or at least less poor), read my original post here.

ETF Tracker Newsletter For May 29, 2026

Ulli ETF Tracker Contact

ETF Tracker StatSheet          

You can view the latest version here.

FROM RECORD HIGHS TO MIXED SIGNALS: HOW MAY WRAPPED UP

[Chart courtesy of MarketWatch.com]

  1. Moving the market

Stocks kept pushing higher to close out May, although the leadership was a bit mixed on the final trading day. The Dow led the way, while the Nasdaq lagged slightly—but zooming out, it’s still been a strong month overall.

On the company front, Dell Technologies stole the spotlight, with shares soaring 28% after delivering a solid earnings beat and raising its full-year outlook.

Chip names also chipped in: Micron climbed 4% and Qualcomm added 2%, continuing a rebound after earlier weakness this month. Despite some volatility, both are still on track to finish May with respectable gains.

The broader market is riding momentum from a record-setting session, helped in part by a temporary easing of geopolitical tension after the U.S. and Iran agreed to a 60-day memorandum aimed at extending a ceasefire.

That said, some analysts believe the market’s upward trend is being driven less by headlines and more by strong corporate earnings growth—a healthier foundation if it holds.

Looking at the scoreboard for May, all the major indexes are firmly in the green. The Nasdaq is leading the pack with an 8% gain, followed by the S&P 500 up 5%, and the Dow trailing with a still-solid 2% advance.

Elsewhere, it was a choppy month for bonds, with yields swinging back and forth before ending roughly unchanged.

Competing forces—rising rate hike expectations, falling oil prices, and ongoing inflation and growth concerns—kept things unsettled.

In currencies and commodities, the dollar ticked modestly higher, while gold slipped slightly after bouncing between key levels. Silver and copper managed small gains.

Crypto had a tougher go, with heavy Bitcoin ETF outflows pulling prices back toward the $72K level, leaving it down about 4% for the month after April’s strong rally.

So, after a strong May, the big question now is: does the momentum carry into June, or are we in for a slowdown after the market’s recent run?

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Weekly StatSheet For The ETF Tracker Newsletter – Updated Through 05/28/2026

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ETF Data updated through Thursday, May 28, 2026

How to use this StatSheet:

  1. Out of the 1,800+ ETFs out there, I only pick the ones that trade over $5 million per day (HV ETFs), so you don’t get stuck with a lemon that nobody wants to buy or sell.
  1. Trend Tracking Indexes (TTIs)

These are the main indicators that tell you when to buy or sell Domestic and International ETFs (section 1 and 2). They do that by comparing their position to their long-term M/A (Moving Average). If they cross above, and stay there, it’s a green light to buy. If they fall below, and keep going, it’s a red light to sell. And to make sure you don’t lose your shirt if things go south, I also use a 12% trailing stop loss on all positions in these categories.

  1. All other investment areas don’t have a TTI and should be traded based on the position of each ETF relative to its own trend line (%M/A). That’s why I call them “Selective Buy.” In other words, if an ETF goes above its own trend line, you can buy it. But don’t forget to use a trailing sell stop of 12%, or less if you’re feeling nervous.

If some of these words sound like Greek to you, please check out the Glossary of Terms and new subscriber information in section 9.

  1. DOMESTIC EQUITY ETFs: BUY— effective 5/20/2025

Click on chart to enlarge

This is our main compass, the Domestic Trend Tracking Index (TTI-green line in the above chart). It has broken above its long-term trend line (red) by +7.54% and remains in “Buy” mode, with our holdings being subject to our trailing sell stops.

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