US equities continued their upward march this week. The Nasdaq Composite rose 1.19%, the Dow Jones Industrial Average added 1.13%, and the S&P 500 gained 0.81%, extending its advance since April to around 16% and notching a ninth straight weekly gain — the longest such streak since 2023. AI remained the dominant driver, with chip and storage sectors leading and the “arms race” narrative around AI infrastructure continuing to earn positive market feedback.
Geopolitical developments were mixed. President Trump indicated that US-Iran talks were progressing well, with discussions on extending a ceasefire and reopening the Strait of Hormuz still underway, temporarily narrowing the tail risk of a full-blown Middle East conflict. Meanwhile, Israel announced expanded ground operations in Lebanon, and joint US-Israeli military action triggered renewed regional tension, pushing Brent crude up about 1.3% to near $93 per barrel. The energy market’s fluctuations reflect the current macro pricing contradiction: the AI-fueled tech investment boom has lowered recession fears, but uncertain energy supply, sticky core inflation, and the second estimate of US Q1 GDP revised down to an annualized 2.5% still leave the Fed with little room for rate cuts. Copper prices also rose further ahead of US tariff reviews, with Goldman Sachs and Citigroup both raising their full-year price targets.
Newly sworn-in Fed Chair Kevin Warsh took office on May 22, and the market views the June 17 FOMC meeting as a key pricing juncture for the second half of the year. CME FedWatch shows a 99.4% probability that rates will be left unchanged in June and a 93.0% probability for July, indicating extremely limited near-term rate-cut expectations. Persistently high Treasury yields have effectively tightened financial conditions by about 75 basis points, exerting hidden pressure on risk-asset valuations. Last week the US Dollar Index slipped to 98.942, the 10-year yield fell to 4.437%, and gold settled at $4,538, reflecting a dual pricing of “higher-for-longer rates plus rising safe-haven demand.” The upcoming May nonfarm payrolls report will be an important variable for verifying the Fed’s policy path. Elsewhere, the yen weakened further, dropping 1.7% in May and approaching the critical 160 level. Japan’s Ministry of Finance deployed roughly $7.36 billion in intervention over the past month, but leveraged funds’ bearish yen bets have climbed to their highest since July 2024. If the Bank of Japan delivers a larger-than-expected rate hike at its June 16 meeting, unwinding of global carry trades could marginally tighten liquidity and weigh on tech stocks and crypto assets.
Crypto Diverges from Stocks, ETFs Set Longest Outflow Streak
The crypto market extended its correction this week, diverging conspicuously from the new highs in equities. BTC opened the week around $77,267 and fell to about $72,675 by June 1, a weekly drop of roughly 6%; ETH declined about 4.5% over the same period, with the ETH/BTC ratio holding roughly flat, indicating similar capital pressure rather than independent ETH weakness. ETF flows were especially notable. US spot Bitcoin ETFs registered their longest continuous net outflow streak since their January 2024 launch — nine straight trading days of net outflows totaling approximately $2.8 billion. BlackRock’s IBIT recorded its second-largest single-day outflow at around $528 million. Spot Ethereum ETFs also saw 13 consecutive daily net outflows totaling roughly $694 million. The Crypto Fear & Greed Index fell further from 39 to 29, entering “fear” territory.
On the derivatives side, BTC open interest declined alongside the price drop. Deribit option skew climbed back to around 16%, with put premiums nearing locally extreme levels, signaling a clear rise in hedging demand. The total stablecoin market cap contracted by about $2.758 billion over the past seven days, and on-chain spot buying power remained weak. Overall, the crypto market lacks independent incremental capital drivers and continues to be suppressed by institutional funds rotating into AI-related tech assets.
DTCC Taps Stellar, Bringing Tokenized Assets into Core Settlement Rails
On May 27, DTC — a DTCC subsidiary — announced plans to connect tokenized asset services to the Stellar public blockchain, with a targeted launch in the first half of 2027. The service will cover tokenized issuance, corporate action processing, and cross-chain interoperability for blue-chip stocks, ETFs, and US Treasuries. DTCC processes roughly $4.7 quadrillion in securities transactions annually, so its integration with Stellar means tokenized equities are officially entering the core US securities settlement infrastructure, rather than remaining confined to on-chain self-issuance layers. XLM surged over 30% on the day, with 24-hour trading volume multiplying more than ninefold.
Mega-IPOs Pose Potential Liquidity Siphon
Anthropic officially filed its S-1 on June 1, and SpaceX is also moving toward a large-scale IPO; the combined potential fundraising could exceed $100 billion. Historically, mega-IPOs tend to siphon liquidity from secondary markets in the near term, and both AI tech stocks and crypto assets — as high-beta risk assets — face the headwind of capital being pulled away in phases. Overall, the biggest macro headwind for crypto today is the continued strengthening of the AI narrative. With highly valued tech assets such as Anthropic and SpaceX poised to hit public markets and absorb liquidity, the window for crypto to rally on its own remains narrow. If an AI bubble deflation phase were to materialize, BTC could undergo a relatively large drawdown, but that very window might also form the bottoming pattern for a new crypto cycle.
This article is market analysis only and does not constitute investment advice. Investment involves high risk; please fully assess your risk tolerance and exercise strict risk control before trading.