Markets rallied in May, breaking a 3-month losing streak as easing trade tensions, strong corporate earnings reports and improved inflation data gave investors reasons for optimism. Volatility subsided, cooling demand in the securities lending markets. EquiLend’s NGT platform demonstrated continued strength, recording 3,182,900 trades executed totaling $3.59 trillion (-4% month-over-month, +17% year-over-year). 

Tariff pauses between the U.S. and China, as well as progressing negotiations between the U.S. and EU, lifted developed market indices, while a weakened U.S. Dollar resulted in relatively strong performance for emerging markets. This led to softened demand for global equities as all jurisdictions saw month-over-month declines in trade counts, with EMEA -11%, Canada -10%, U.S. -3% and APAC -9%.  

Conversely, as yields increased and fixed income came under pressure, we saw bond activity grow by 1% on strength in U.S. corporate bonds (+10%) and global sovereign debt (+2%). The U.S. credit rating downgrade resulting in weak demand at U.S. Treasury auctions was a factor here. 

All in all, demand remains strong and trade counts are elevated across the marketplace. NGT trade counts rose 17% year-over-year, with the U.S. and Canada setting the pace at +23% and +25%, respectively. The focus will continue to center around U.S. politics, with policy decisions likely to continue as the key factor in market performance.