Daily Market Outlook, May 1, 2026 

Patrick Munnelly, Partner: Market Strategy, Tickmill Group

US equity futures are extending the post-earnings rally after both the S&P500 and Nasdaq printed fresh ATHs on Thursday. The market is still leaning into the idea that megacap tech can outrun the macro drag, helped by robust earnings and AI capex/investment momentum. Apple is firmer after-hours on an upbeat revenue outlook and another large buyback, despite flagging higher memory-chip costs. April was violent under the surface — oil shock, Middle East escalation, and inflation repricing — but US equities still delivered their best month since 2020 as AI-led tech leadership overwhelmed the macro noise. The question for May is whether the rally remains an earnings-led melt-up or turns into a more selective, valuation-sensitive tape as investors digest rising input costs and heavier capex. FX and macro are less benign. The yen has slipped back to around 157.18 per dollar after Japan’s intervention pushed it as strong as 155.57, with USD/JPY having tested the 161 area earlier in the week. WTI is +0.2% near $105.30/bbl after Trump confirmed the US will maintain its naval blockade of Iranian ports, keeping the risk of an extended Hormuz closure alive. The inflation impulse is already showing up: US Q1 growth improved due to AI-related investment, but March PCE rose 0.7% m/m, the largest increase since 2022, while ECB officials are increasingly leaning toward a possible June hike unless energy stabilises. Bottom line: equities are still trading the micro boom, but rates, FX and central banks are trading the oil shock – and that divergence is the key fault line for the tape.

The ECB and BoE both acknowledged the same energy-shock trade-off — weaker growth, higher inflation — but the policy reaction functions look increasingly different. Lagarde avoided a formal commitment to June, yet she did little to push back against market pricing for a hike, and her line that “directionally, I know where we’re heading”, reinforced by post-meeting sources, leaves the impression that ECB policy is likely tighter by 11 June. The BoE, in contrast, sounded much more cautious: the MPC minutes show the pre-shock split coming back, with Bailey trying to hold the centre, while the focus on remit flexibility suggests a preference to wait for evidence of second-round effects rather than rush into a June hike. The market takeaway is clear: UK/euro area policy-rate spreads should narrow, as the ECB seems more willing to support near-term tightening, while the BoE is more likely to delay; the cost is that medium-term inflation-expectation spreads may widen again as investors expect a more tolerant UK response compared to a more forceful ECB one.

Japan’s FX intervention was unusually aggressive and deliberately pre-emptive. The usual script was only partly followed: Katayama and Mimura escalated the verbal warning cycle, flagged speculative moves, and emphasised close communication with the US — effectively signalling political cover to act — but the actual intervention came even after USD/JPY had already fallen from above 160.50 to around 159.20, a move that would normally have satisfied officials. The estimated $60–80bn yen-buying operation was far larger than the $35–40bn daily clips seen in 2022/2024 and closer in scale to 2011-style operations, suggesting the MoF wanted to get ahead of Golden Week/thin-liquidity carry pressure, yen-negative month-end flows, and the risk of a break above the prior 161.90 high triggering stops and option-related USD demand. Tactically, the move was smart: verbal intervention now has more credibility, and the MoF likely bought itself time. Strategically, however, the yen’s problem remains unresolved — BoJ policy is still too easy versus increasingly neutral/hawkish peers, fiscal policy is turning more expansionary, inflation is accelerating, and Japan’s REER is at its weakest since 1970. Intervention can slow the move, but it cannot fully offset the structural pressure on the yen.

Overnight Headlines

• Japan’s Mimura Declines To Comment On Yen Intervention Talk

• Tokyo Inflation Cools Further, Backing BoJ Caution On Rate Hikes

• CENTCOM Briefed Trump On Potential Iran Plans

• Trump Bets On Quick Iran Oil Crunch; Experts See Rising Costs

• Pentagon Calls Timeout On War Powers

• Fitch Warns US Debt Burden Is ‘Far Above’ Other AA Rated Nations

• Treasury Yields Rise In Second Month Of Iran War

• Economic Crosscurrents Go Global As Energy Shock Meets AI Wave

• Apple Sales Top $111B In Q2, Powered By iPhone 17

• Alphabet Has The Second Biggest One-Day Jump In Market Cap Ever

• Meta Attributes Layoffs Plan To CapEx, Won’t Rule Out Further Job Cuts

• Huawei’s AI Chip Sales Surge As Nvidia Stalls In China

• South Korea’s Export Growth Stays Strong On Semiconductor Demand

• NZ Consumer Confidence Hits Three-Year Low On Iran War

FX Options Expiries For 10am New York Cut 

(1BLN+ represents larger expiries and is more magnetic when trading within the daily ATR.)

• EUR/USD: 1.1650 (EU922.8m), 1.1800 (EU917m), 1.1500 (EU870m)

• AUD/USD: 0.7250 (AUD1.17b), 0.7020 (AUD796.3m), 0.7150 (AUD554.9m)

• USD/JPY: 160.00 ($635m), 155.00 ($505m), 157.00 ($435m)

• USD/CAD: 1.3600 ($1.22b), 1.3660 ($987.3m), 1.3545 ($530.1m)

• USD/CNY: 6.7500 ($300m)

• USD/MXN: 17.28 ($300m)

• GBP/USD: 1.3700 (GBP416.1m), 1.3650 (GBP405.9m)

CFTC Positions as of April 24, 2026: 

• Equity fund speculators cut their CME S&P 500 net short by 12,644 contracts, bringing it to 402,253.  

• Equity fund managers increased their CME S&P 500 net long by 9,443 contracts to 1,020,550.  

• Speculators reduced their CBOT U.S. 5-year Treasury futures net short by 92,995 contracts to 1,532,750.  

• Speculators also trimmed their CBOT U.S. 10-year Treasury futures net short by 9,394 contracts to 790,971.  

• Meanwhile, speculators expanded their CBOT U.S. 2-year Treasury futures net short by 39,547 contracts to 1,743,353.  

• Their CBOT U.S. UltraBond Treasury futures net short was lowered by 536 contracts to 300,287.  

• At the same time, speculators raised their CBOT U.S. Treasury bond futures net short by 9,670 contracts to 83,786.  

• Bitcoin showed a net long position of 2,071 contracts.  

• The Swiss franc recorded a net short of 33,273 contracts.  

• The British pound remained net short at 52,039 contracts.  

• The euro posted a net long position of 41,324 contracts.  

• The Japanese yen showed a net short position of 94,460 contracts.

Technical & Trade Views

SP500

• Daily VWAP Bearish

• Weekly VWAP Bullish

• Above 7050 Target 7300

• Below 6950 Target 6850

DXY

• Daily VWAP Bearish

• Weekly VWAP Bearish

• Above 98 Target 99

• Below 97.80 Target 96.12

EURUSD 

• Daily VWAP Bullish

• Weekly VWAP Bullish

• Above 1.1760 Target 1.19

• Below 1.1750 Target 1.1590

GBPUSD 

• Daily VWAP Bullish

• Weekly VWAP Bullish

• Above 1.3430 Target 1.3610

• Below 1.34 Target 1.3290

USDJPY 

• Daily VWAP Bearish

• Weekly VWAP Bearish

• Above 160 Target 161

• Below 159 Target 152

XAUUSD

• Daily VWAP Bullish

• Weekly VWAP Bullish

• Above 4600 Target 5000

• Below 4500 Target 4350

BTCUSD 

• Daily VWAP Bullish

• Weekly VWAP Bullish

• Above 73.5k Target 80k

• Below 72.6k Target 70.5k