Good morning and welcome to today's market chronicle. It's Tuesday, May 19, 2026. Once again, the leader of the free world has saved the world from himself, and markets are supposed to be grateful.
Let me start with the word TACO because it deserves to be said out loud this morning. Trump Always Chickens Out. Yesterday, our beloved president announced that he had personally called off a scheduled military strike on Iran because, and I quote the spirit if not the letter, things are going well in the negotiating room. The market, trained like a Pavlovian dog over the last eighteen months, immediately decided this was good news, breathed a sigh of relief, and then remembered that there are other problems in the world. Oil fell, WTI dropping toward $102.90 per barrel, Brent slipping to around $110, because apparently an Iran war was already priced into crude and now the risk premium is leaking out. Fine. Meanwhile the bond market, which has no interest in good news stories, continued to do whatever it feels like doing, with the 10-year yield sitting at 4.60% and the 30-year hovering around 5.15%, near levels not seen since 2023. Translation: the bond market is telling the stock market something the stock market keeps choosing not to hear.
The tech selloff continued overnight. Nasdaq 100 futures are down 0.7%, S&P futures off 0.4%, because Micron is now in its fourth consecutive session of decline, the argument being that the AI memory trade has gone too far, too fast. Whether that argument is right is, frankly, irrelevant. What matters is that the cockroach in the basement has been spotted, and now everyone is tip-toeing around the kitchen wondering what else is down there. The AI-driven bull market ran on a story, and stories need maintenance. This one is showing cracks.
But everyone is pretending not to notice that yields at these levels are genuinely incompatible with the valuations being assigned to companies that will generate most of their cash flow sometime in the late 2030s. No one wants to do that math with their morning coffee. I understand. I respect the self-preservation instinct.
What is on the agenda today. Home Depot reports before the bell, and Wall Street will discover whether the American consumer is still hammering things around the house or has quietly put down the drill. Toll Brothers too, which will tell us something real about the housing market. April pending home sales data is due, and given yields where they are, the number is unlikely to be cheerful.
Gold sits around $4,540, which is its own commentary on everything. Bitcoin near $77,000, down nearly 5% on the week. The skunk at the party, as always.
A day where the absence of war is the good news, and the bond market still refuses to applaud. The wonderful world of finance.
Have a good one.