Last week : US-Iran accord ; Oil higher ; Warsh 1st meeting as Chairman (FED hikes now expected); US Tech stocks higher
WEEKLY TRENDS
In a 4 day week (US holiday last Friday) the US stocks rallied again, thanks to the US-Iran accord (the 38th time Trump announced the end of the war) which included the reopening of the Hormuz strait and despite
Warsh delivering his first FOMC meeting speech as FED Chairman, hinting at rate hikes and planning to make important changes, especially in the way the FED prepares the market for its expected decisions. Note that the BOJ hiked by 25bps setting its rate at +1% the highest level since 1995 and being the first hike since December well received by investors as the Nikkei ended the week at +8%.
Since 16 FOMC officials out of 18 are in favour of raising rates, the 2yr US Bond yield moved up by 10bps, reducing the steepening to a mere +27bps vs 40bps the previous week. (US rates Futures now plan on 2 hikes before the end of the year). On the earnings front, Accenture cut its revenue forecast causing its stock to crash by 20%. Next week, Micron’s earnings and May US PCE inflation data releases on Thursday shall most probably be the centre of attention.
M&A : Edenred (+15%, approached by BC Partners) Fox Corp (-20%, after Roku’s acquisition for $22bn, integration and dilution risks)
NB : Legrand (+13%, Citi’s ‘buy’ new target at €185) Western Digital (+32%, MS upgrade to ‘o/w’ and new target at $650) Moderna (+28%, FDA decision on mFlusiva)
US curve steepening (2-10 years) lower at +27ps (-13bps)
HY corp. spreads lower : US at +263bps (-15bps) EU at +263bps (-2)
Commodities
Oil price WTI much lower (-9%) after the US-Iran accord and the reopening of the Hormuz strait
Gold price lower (-1.5%, due to higher USD, 2yr US yield) Copper -1%. Silver -7%. Platinum -4%
CB decisions
FED (unchanged but officials hawkish 16/18) BOE (unchanged at 3.75% vs CPI at +2.8%) SNB (unchanged at 0% but signalled possible FX intervention) BOJ (+25bps) RBA (unchanged after 3 consecutive rate hikes)
Crypto
BTC (-1%) ETH (-2%) SOL (-4%) XRP (-5%)
Under the watch
FED Warsh new plan: FOMC to deliver on price stability, no more forward guidance, new task forces (Comm., Data, B/S, productivity & jobs, inflation)
Nota Bene
MANGO (Meta, Anthropic, Nvidia, Google, OpenAI) not FAANG anymore
Macro releases : USMay PCE , Q1 GDP final reading (25 June)
WHAT ANALYSTS SAY
DWS, 12 June 2026
La Financière de l’Echiquier, 19 June 2026
Authors : Alexis Bienvenu, Portfolio Manager
The new chairman of the US Federal Reserve is presenting himself as a reformer, or even as someone who will do away with certain long-standing inherited practices. A velvet revolution took place on 17 June, during the press conference given by Kevin Warsh, the new Chair of the US Federal Reserve (Fed). Speaking in a manner bordering on polite offence towards his predecessor Jerome Powell – who remains a member of the Board of Governors – he implicitly accused the Fed of failing to do enough to combat inflation for more than five years.
It is true that, since then, price rises have consistently exceeded the Fed’s official target of 2 per cent. Since June 2021, it has averaged 3.8% and has never fallen below 2.6%. Yet, ‘inflation is a choice’, the new chairman asserted, true to his orthodox monetarist stance. The responsibility therefore lies with the Fed of the past. Everything must change. Everything will change.
First shift: the Fed will henceforth refrain from guiding the markets. Unlike the stance adopted since the 2008 crisis – when the predictability of monetary policy was valued by markets shaken by a crisis they had not anticipated – Warsh believes that the Fed must now draw on signals from the markets rather than the other way round. The direct consequence is that the central bank’s statement no longer sets out an implicit path for monetary policy but is strictly limited to stating the facts. The markets will have to draw their own conclusions: instead of systematically anticipating the Fed’s reaction to every piece of macroeconomic data, they will have to accept that they must wait for the Fed to speak. In particular, the mantra ‘bad news is good news’ could lose much of its relevance.
A second major shift: inflation will be the main focus of efforts, at the risk of relegating the other aspect of the Fed’s mandate – full employment – to the background; this was virtually ignored in the latest statement. Admittedly, with an unemployment rate of 4.3 per cent, there is no sense of urgency. But even when that rate was hovering around 10 per cent in 2010, Kevin Warsh was already standing out for taking a significantly less accommodative stance than his peers. It was for this very reason that he left the Fed in 2011, in disagreement with the extension of asset purchase programmes. Having worked in close coordination with Ben Bernanke during the acute phase of the 2008 crisis, he judged that a further expansion of the balance sheet was not required and chose to signal his opposition by stepping down.
This uncompromising stance now forms the backdrop to a third break with the past. Appointed by Donald Trump – who no doubt appreciated his criticism of the decisions made by Jerome Powell, who had become a scapegoat for the president – Warsh has no intention of simply continuing along the same path. He presents himself as a reformer, or even a dismantler of certain inherited practices, and is therefore launching five key initiatives: communication (an end to ‘forward guidance’); the size and composition of the balance sheet, which he wishes to normalise; statistical tools deemed to be failing; the analysis of employment and productivity dynamics in the age of AI; and above all, the policy framework for combating inflation, against a backdrop where a relaxation of the target had been mooted in recent years.
By appointing a maverick to head the Fed, Trump is turning the page on Powell. But he is also choosing a figure with strong convictions, equally prepared to challenge established frameworks. In an environment where expectations of interest rate rises are growing, even as the White House would prefer monetary easing, the conditions for a potential clash are in place.
During Trump’s first term, the good relations with the Fed lasted barely six months. With a decidedly more uncompromising Fed chair, how many days will the honeymoon period last?
Edmond de Rothschild AM, 16 June 2026
Author : Jean-François Dusch Artaz, CEO EdR UK, CIO Bridge
Some segments of the private debt market are struggling
The tensions observed since the start of 2026 are concentrated in clearly identified segments. On the one hand, there are so-called semi-liquid vehicles, which offer investors a degree of flexibility whilst being invested in assets that are illiquid by nature. On the other hand, there are vehicles underpinned by highly leveraged financing, often at variable rates, which are particularly prevalent in the technology sectors. The macroeconomic environment acts as a litmus test here. Rising interest rates, whilst automatically improving returns, put the most heavily indebted borrowers at risk. At the same time, uncertainties surrounding the impact of AI on certain business models — particularly in the software sector — are heightening concerns. The result is a gradual rise in stress indicators, which is also observable in Europe, although to a lesser extent than in the United States. In the tech sector, rising default rates are expected in 2028 as loans reach maturity.
Other segments of the private debt market remain fundamentally attractive
Seen in this light, the asset class is now causing concern amongst some investors. However, other segments, such as infrastructure debt, remain excellent investment opportunities. Although part of the private debt universe in the broadest sense, infrastructure debt differs profoundly from it in terms of its fundamentals. Its underlying assets – energy networks, transport infrastructure and equipment linked to the digital transition – are by their very nature essential, even strategic, and enjoy strong political support. Above all, its revenue streams are predictable and largely based on long-term contracts, often entered into with public or regulated entities. Infrastructure debt thus enables investors to benefit from predictable cash flows thanks to highly structured and secure financing, backed by underlying infrastructure assets, capturing a premium relative to corporate debt markets to compensate for illiquidity and complexity, but without compromising on credit quality. In practical terms, this structure results in distinct risk profiles, with historically lower default rates than in corporate debt. This segment is also largely insulated from current market pressures as it is primarily focused on exposures that are less cyclical and even less sensitive in the short term to technological disruptions. Finally, opportunities exist at all levels of the capital structure (i.e. senior investment-grade or junior non-investment-grade), enabling investors to select and tailor their risk/return profiles.
Private debt is entering a phase of maturity
Looking beyond the specific case of infrastructure, the current developments reflect a more profound transformation of the market. After years dominated by volume growth and abundant liquidity, the private debt market is entering a phase of maturity.
In this new cycle, the ability to distinguish between sub-segments, analyse fundamentals and exercise selectivity is becoming crucial. For the private debt market as a whole is not in crisis: we are simply witnessing a change in the market landscape.
Candriam, 11 June 2026
Authors : Paulo Salazar, Head of EM Equity
The prospect of a ceasefire or de-escalation between Iran and the United States reinforces the macroeconomic backdrop we have been discussing with investors for several weeks: reduced geopolitical risk, lower oil prices, easing inflationary pressures and a weaker US dollar are creating a favourable environment for emerging markets.
A sustained fall in oil prices should help to reduce headline inflation in many emerging economies, thereby giving central banks additional scope to ease monetary policy and improve domestic financial conditions.
The weakening of the US dollar is particularly favourable for emerging market assets. Historically, periods of dollar weakness have coincided with stronger performance in emerging market equities and local currencies, thanks to improved external financing conditions and an expansion of capital flows beyond the United States. Falling energy prices are acting as a positive shock to the terms of trade for net oil-importing countries. This is supporting consumption, current account balances and corporate profitability across several emerging regions.
We continue to believe that this environment could favour a rotation within emerging equity markets. The energy sector, which has outperformed during recent geopolitical tensions, may give back some of its relative gains, whilst the materials sector could benefit from more favourable global growth prospects and a normalisation of commodity markets.
Precious metals also merit particular attention. The sector has underperformed expectations since the start of the conflict, despite a high level of geopolitical uncertainty. As markets shift their focus from geopolitical risk to falling interest rates, a weak dollar and improving liquidity conditions, precious metals could begin to catch up.
At a regional level, we identify net oil-importing markets as among the main beneficiaries, particularly in certain parts of Asia, as well as countries such as South Africa. In Latin America, falling inflation and easing global financial conditions should also prove favourable, particularly in countries where central banks still have room for manoeuvre to continue their cycles of monetary easing. Overall, the combination of lower oil prices, falling inflation, more accommodative monetary conditions and a weaker US dollar constitutes one of the most favourable macroeconomic environments for emerging markets seen in recent quarters. This analysis is broadly consistent with the framework we have been presenting to investors over the past few weeks.
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