Preview of US Stock Market | The three major stock index futures fell together, bringing a glimmer of hope to US-Iran talks. It is reported that the United States has agreed to temporarily exempt Iran from oil sanctions during negotiations.

Pre-market market trends 1. Before the market on May 18th (Monday), the futures for the three major U.S. stock indexes all fell. As of the time of writing, Dow futures fell by 0.29%, S&P 500 index futures fell by 0.13%, and Nasdaq futures fell by 0.03%. 2. As of the time of writing, the Germany DAX index rose by 1.02%, the UK FTSE 100 index rose by 0.90%, the France CAC40 index fell by 0.65%, and the European Stoxx 50 index rose by 0.34%. 3. As of the time of writing, WTI crude oil fell by 0.04%, trading at $100.98 per barrel. Brent crude oil rose by 0.10%, trading at $109.37 per barrel. Market News News is circulating that the United States has agreed to temporarily exempt Iran from oil sanctions during negotiations. On May 18th, a source close to the U.S.-Iran negotiating team stated that the U.S. has agreed in the latest negotiation draft to "exempt" Iran from oil sanctions during the negotiations, which means that the U.S. will temporarily suspend sanctions. Iran has emphasized that the lifting of all sanctions on Iran must be part of U.S. commitments. However, the U.S. has proposed temporary waivers to be implemented by the Office of Foreign Assets Control (OFAC) of the U.S. Treasury Department until a final agreement is reached. As of now, official confirmation from both the U.S. and Iran has not been made. Almost simultaneously, the Prime Minister of Pakistan expressed optimism about the new round of U.S.-Iran talks held in Islamabad. Iran presents a revised proposal for negotiations, sparking hope for U.S.-Iran talks! "TACO Moment" sees tech stocks poised for a major rebound. Reports citing sources familiar with the matter indicate that Pakistan has forwarded Iran's revised proposal to end the war to the U.S., and the U.S. has received the relevant proposal. Additionally, recent news shows that Iran's Foreign Minister has emphasized a focus on ending the war and is continuing discussions with Oman on a mechanism for the Strait of Hormuz. These recent developments together indicate that the U.S. and Iran have not cut off communication channels, constituting the latest marginal positive signal for U.S.-Iran talks. Another "TACO Moment" that is likely to usher in a global risk asset rally closely related to AI computing infrastructure, tech stocks, cryptocurrencies, and high-yield corporate bonds may be on its way. Global bond markets continue to decline, with expectations of a Fed rate hike within the year stirring inflation trade concerns. On Monday, bond markets from Tokyo to New York continued their decline, as ongoing Middle East conflicts leading to rising energy prices have exacerbated inflation concerns and prompted investors to increase their bets on global central bank rate hikes. The benchmark 10-year U.S. Treasury bond yield, which moves in the opposite direction of prices, surged to its highest level since February 2025, reaching 4.631%. Last week, the yield had already climbed more than 20 basis points. The two-year U.S. Treasury bond yield, which is most sensitive to inflation and rate expectations, reached a 14-month high of 4.102%, while the 30-year U.S. Treasury bond yield rose to a one-year high of 5.159%. The rise in yields has boosted the U.S. dollar and cast a shadow over the stock market, which had soared in recent weeks due to the AI frenzy. Morgan Stanley's latest forecast: Bond market storm may lead to stock market correction, long-term bullish outlook remains optimistic. As the selling wave in the global bond market continues to ferment, the rally in U.S. stocks driven by artificial intelligence faces a stern test. Mike Wilson, chief U.S. stock strategist at Morgan Stanley, warns that if bond market volatility intensifies and long-term rates continue to rise, the stock market may face its first substantive correction since hitting a low at the end of March. Despite the rising short-term risks, Wilson's team has not changed its long-term bullish stance on U.S. stocks. In fact, they recently raised their 12-month target for the S&P 500 index to 8300 points, based on the view that, apart from the recovery period after major shocks, U.S. companies are experiencing the strongest profit growth in over twenty years. Long-term bull market support for gold! Goldman Sachs Group, Inc. raises global central bank gold buying forecasts and reiterates a year-end gold price target of $5400. Amid a constantly reshaping global political landscape and lingering inflation clouds, Goldman Sachs Group, Inc. has significantly raised its forecast for global central bank gold purchases and reiterated its year-end gold price target of $5400 per ounce. This assessment resonates with the optimistic signals released by several international investment banks in recent days, injecting a shot in the arm for the gold market that has been fluctuating for months. Analysts at Goldman Sachs Group, Inc. stated in a report that they expect global central bank gold purchases to increase to an average of 60 tons per month by 2026. This new forecast represents a substantive methodology revision. Trouble in the Hormuz Strait pushes up oil prices, while copper prices fall for three consecutive days amid inflation concerns. Copper prices have continued to decline, with concerns about global inflation prospects deepening, putting pressure on industrial commodities across the board. The U.S.-Iran negotiations have once again stalled, further exacerbating the already fragile global political situation. U.S. President Trump has once again threatened Iran, and currently, there are still major differences between the two sides on ending the conflict and reopening the Strait of Hormuz, pushing oil prices higher. "Debt vigilante" Yardeni: The Fed should abandon its loose policy stance in June, or risk losing control over interest rates. According to Yardeni Research, as investor concerns about inflation intensify, the Federal Reserve needs to keep up with the bond market or face the risk of losing control over borrowing costs. Ed Yardeni, President and Chief Investment Strategist of the organization, stated that, given the current market environment, the Federal Reserve should abandon its loose policy stance at the June meeting. In a report, Yardeni wrote, "If the Fed fails to abandon its loose policy stance, investors will see that the central bank is lagging behind the curve on inflation and will demand a higher inflation risk premium." Stock-specific News Trump boasts about Intel Corporation's investment performance: $40 billion in profits in 8 months, government will consider a "slow jog" divestment. U.S. President Trump stated in an interview with Fortune magazine on Monday that he "should have asked for more" U.S. government shares in Intel Corporation. The Trump administration acquired a 10% stake in Intel Corporation last year and announced an investment of about $10 billion in the chipmaker for building or expanding factories in the U.S. Eight months after the deal was reached, the value of the government's stake in Intel Corporation has grown to over $50 billion. Trump said, "Intel Corporation should now be the largest company in the world." He mentioned Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR's dominant position in the chip industry and stated that if he had taken office earlier, "Intel Corporation would now have all these businesses." Sun Group's $25 billion acquisition of LiveRamp leads to a pre-market surge in LiveRamp shares. Sun Group (PUBGY.US) announced a $25 billion all-cash deal to acquire the data collaboration platform, LiveRamp (RAMP.US). On Monday morning before the market opened, LiveRamp shares surged by 27%. The deal aims to strengthen Sun Group's capabilities in data and artificial intelligence to help brands better navigate the highly fragmented media market. According to the terms of the agreement, Sun Group will pay $38.50 per share for LiveRamp, a 29.8% premium over the company's closing price on the last trading day before the announcement (May 15th). Tesla, Inc. (TSLA.US) raises prices for the Model Y for the first time in two years to boost profits amid declining sales. Tesla, Inc.'s website shows that the company raised prices for the Model Y series models in the U.S. market last Saturday (May 16th) for the first time in two years. Specifically, the Long Range all-wheel-drive and rear-wheel-drive versions of the Model Y each increased by $1,000, with adjusted prices of $49,990 and $45,990 respectively; the Model Y Performance high-performance all-wheel-drive version increased by $500 to $57,990. The entry-level models' prices remained unchanged at $39,990 and $41,990. Arm (ARM.US) faces U.S. antitrust investigation over chip licensing practices, with shares plummeting. According to reports, Arm (ARM.US) is facing an antitrust investigation by the U.S. Federal Trade Commission (FTC) over whether the company, with its dominant position in chip licensing, has engaged in behavior that restricts or indirectly hinders competitors from accessing core processor technology licenses as it expands its in-house chip business. This investigation comes at a time when the global chip industry is experiencing an AI wave, bringing the company's business model under increasingly severe global regulatory scrutiny. For investors, this investigation highlights the rising regulatory risks faced by Arm, one of the semiconductor industry's most important technology suppliers. Bio-Rad Laboratories (BIO.US) in a slump, with activist investor Elliott making a strong entrance. It has been reported that activist investor Elliott Investment Management has purchased a large number of shares in Bio-Rad Laboratories (BIO.US) and plans to boost the stock performance of this life science instrument supplier. The extent of Elliott's stake in Bio-Rad Laboratories is not yet clear. Bio-Rad is currently valued at approximately $6.7 billion, with its stock price having fallen by over 70% since reaching a peak at the end of 2021. Baidu Inc Sponsored ADR Class A Group (BIDU.US) reports Q1 revenue of RMB 32.08 billion, with over half of core AI new business revenue, up 49% year-over-year. Baidu Inc Sponsored ADR Class A Group reported first-quarter revenue of RMB 32.08 billion, surpassing the estimated RMB 31.49 billion. Adjusted operating profit was RMB 3.81 billion, exceeding the estimated RMB 3.34 billion. Adjusted earnings per ADS were RMB 12.06, surpassing the estimated RMB 11.84. In the first quarter, Baidu Inc Sponsored ADR Class A Group's intelligent cloud infrastructure revenue was RMB 8.8 billion, a 79% year-over-year growth. GPU cloud revenue grew by 184% year-over-year. AI application revenue was RMB 2.5 billion, roughly flat year-over-year. iQIYI, Inc. Sponsored ADR Class A (IQ.US) releases Q1 2026 financial report: total revenue of RMB 6.23 billion, with membership revenue growth. On May 18, iQIYI, Inc. Sponsored ADR Class A (IQ.US) released its unaudited financial report for the first quarter ending on March 31, 2026. Total revenue for the first quarter was RMB 6.23 billion. Membership services revenue was RMB 4.2 billion, an increase of 2% quarter-over-quarter. Online advertising revenue was RMB 1.24 billion, content distribution revenue was RMB 0.36 billion, and other revenue was RMB 0.43 billion. Tencent Music Entertainment Group Sponsored ADR Class A (TME.US) completes acquisition of Ximalaya. Tencent Music Entertainment Group Sponsored ADR Class A announced that the acquisition agreement reached with Ximalaya Holding and several other parties regarding the acquisition of Ximalaya was completed on May 18, 2026. According to the terms of the acquisition agreement, Ximalaya's equity securities held by Ximalaya's relevant shareholders and Ximalaya's employee share plan participants have been cancelled in exchange for the acquisition consideration, which includes a maximum of $1.26 billion in cash and up to 175 million shares of Tencent Music Entertainment Group Sponsored ADR Class A's ordinary Class A shares. Following the completion of the acquisition, Ximalaya has become a wholly-owned subsidiary of Tencent Music Entertainment Group Sponsored ADR Class A. Important Economic Data and Events Forecast 10:00 p.m. Beijing time, U.S. May NAHB Housing Market Index.