Monday May 25, 2026: Financial Markets update. Wars, Stocks, Oil, Gold, Silver, and SpaceX

Added: 2026-05-25

[00:00:00]Hello dear friends. My name is Clive Thompson and I'm with Clive Jr.

[00:00:06]>> Hello.

[00:00:08]>> Today is Monday 25th. I've just checked that. Yeah, 25th of May 2026.

[00:00:14]Uh stock markets are just open in Europe. Uh they've closing down in this in the in Asia. And uh that we'll talk about what's going on in the financial world. Well, first of all, last week saw another week of gains on the US stock markets. Not very much, up less than 1% I would say, but the Dow Jones Industrial Average hit an all-time record. But what I think is interesting to note is that the indices have been up for eight weeks in a row. Eight solid weeks. Now, the chance of it going up from one week to the next, normally you'd say it's one in two. It could go up or it could go down. Uh, so it's a bit like playing roulette to get eight in a row. How what are the chances that black is going to come up eight times in a row? Um, could you tell me what what's the chance of it coming up one in two time? One, just once. It's one in >> one in two.

[00:01:04]>> Yeah. So, what about coming up eight times in a row? Can you work that out?

[00:01:07]>> 2 4 8 16 32 60 64 128 256 >> one in what?

[00:01:20]>> One in 256.

[00:01:21]>> That's right. So, it's a one in two.

[00:01:22]Theoretically, there's a 1 in 256 chance of the stock market making uh eight gains in a row or for that matter eight losses in a row. Having said that, uh stock markets are peculiar and they can keep going up for a long time in in straight lines. And also uh just like roulette, what happened last week or the last eight weeks tells you nothing about the next week. So, it could be another record next week or it could not be. And the chance I I say is still 50/50. So, no matter what the on a on a roulette wheel, no matter what colors come up and no matter how many times it's come up, it still won't tell you what the next color is likely to be. Um, so the street of Hormuz, it's slightly open and mostly closed. A few ships are going through and Iran apparently is now charging $150,000 as security fees to ensure free passage, but not all ships are getting through anyway. U many are being refused uh entry.

[00:02:27]Excuse me. Sorry, I hate you there. So many are not being allowed, especially the western ships. Um we've gone last week I think the stocks went up and actually bond deals went down. The reason was we were learning that the negotiations between the USA and Iran were nearly done, nearly over, nearly completed. Well, this morning we're learning that they've nearly not started. Uh so this is kind of the way it goes. You hear one thing and then you hear the other thing. Um having said that, it does look like stock markets don't really care. They're just shrugging off all this news and going higher anyway. U the big news last week was the announcement that Oh, let me see if you remember something about rockets.

[00:03:07]What was the big news last week that everybody's watching?

[00:03:11]>> SpaceX.

[00:03:12]>> SpaceX. Yes. And what does SpaceX make?

[00:03:15]>> Rockets >> amongst other things. Yes. Um the big thing that SpaceX makes is something called Starlink, which is a um I think it's about 9,000 10,000 satellites flying around the planet Earth where you can have broadband internet. I don't know if broadband is the right word, but any high speeded internet up to a point um in return for a fee of something like $50 to $100. Uh, of course, that's only really useful if you live in a place where you can't get that sort of internet connection, for example, you're living in a a remote place where there's not much in the way of telephone connections or you're out at sea or maybe you're on an airplane, for example. That's when um SpaceX's service would come in very useful because it's pointing towards wherever you are all the time 24 hours a day. Um now SpaceX aims to raise $50 billion maybe 75 billion that the aim and the talk is that it will have a market capitalization somewhere in the range of $1.75 trillion through to $2 trillion.

[00:04:16]And the talk is that there'll be an allocation to the public at large, the man in the street, of 30%. That's uh let's just say that's higher than most flotations on NASDAQ. Uh we don't yet know the price or the market valuation being put on SpaceX. These are just guesses at the moment. Uh some say that the flotation will happen around June the 12th. Some say a few days earlier, some say a few days later, but that gives you a rough guide of when it's going to come. Uh if you want to subscribe for shares, you'll have to wait to see what the details are. Uh of course, you can always ask your bank if they'll get an allocation and ask if they get an allocation, whether you could apply for some. Uh I'm not making any suggestion that is a good or bad investment. Uh however, I've been watching the news and the social media um uh comments about this. I think there's a lot of criticism going on. Um people are criticizing the fact that it's going to be a small float of a very big company and that NASDAQ has got a rule a new rule I think which is uh called the fast entry rule which means that after 15 days SpaceX will enter the NASDAQ 100 index.

[00:05:32]It'll trade on NASDAQ straight away but it'll be in the index after 15 days.

[00:05:37]Now, when it's in the index, it means that anybody who buys an exchangeraded fund on NASDAQ or S&P 500 will effectively own a a slice of um of SpaceX. Do you know what an exchange traded fund is?

[00:05:56]>> Um an ex an exchange traded fund.

[00:06:01]>> Speak loudly and don't don't touch the microphone.

[00:06:04]>> An exchange trade fund. Yeah. Do you know what it is?

[00:06:07]>> Um, >> not really.

[00:06:14]>> Okay, that's all right. I'll explain.

[00:06:16]Extended shredded fund is a fund which owns lots of shares in a particular index like the S&P 500 or the NASDAQ 100. So if it it will own all the shares in the NASDAQ 100 if it's an exchange rated fund tracking the NASDAQ 100 or it will own all the shares of the S&P 500 if it tracks the S&P 500. So the fact that SpaceX will go into the index after just 15 days rather than the usual three months means that if you have a pension plan which owns an ETF which owns the index and most pension plans do you're automatically becoming a shareholder indirectly in SpaceX after just 15 days a float which you might like or you might not like. But there is another peculiar rule which has been criticized by some. Um I can see why they've done it but the the rule is called the multiplier rule. So if a company's in the index with a small float out of a very large number of shares, they have something called the multiplier which allows number of shares to be treated as if they were three times as many. So you're going to own um a larger proportion of the company. Now there's a funny thing about when you have a very small amount of shares in on a quoted on a stock market compared with the total size of the company and it's this probably that small amount of shares is trading at a higher price than would be the case if all the shares were on the stock market. So imagine you've got um only in this case uh let's say 10% of the shares I haven't got the exact figure 5% of the shares maybe let's say you've got 5% issued now out of a 100 shares only five are issued but maybe there's 10 people who want to own those shares so the share price is going to be quite high because there's 10 people want to own just five shares but let's say instead of having just five shares in issue you've got 40 shares in issue those 10 people, well, they only want to have one share each perhaps, but there's 40 available, so the share price would be a lot lower. So, by having a very small float, it has the effect of making the shares seem to be worth more than they would be if the entire company was floated. I mean, there are some counterarguments to that. Um, because if the entire company was floated, it would mean the voting control would not be in the hands of just Elon Musk. I'll come back to that in a minute, which might be a a positive factor for some. But long and short of it, small number of shares means the price is probably higher than it would otherwise be if there was a large number of shares on the market.

[00:08:55]And then you take that higher price and multiply it by three, it can have a distortionate and distorting effect on what the waiting of the company is in the S&P 500 or the NASDAQ 100 index. So there's been some criticism of this multiplier. Um the another criticism out there is the super control which will be in the hands of Elon Musk because every share he owns will have 10 votes whereas every other share will only have one vote. So that effectively means he controls the company and some people think that's wonderful. Some people are not very happy about it. Um, other things going on uh on social media about SpaceX is related to the absorption into SpaceX very very recently of X and X AI.

[00:09:43]Um, so X is what used to be called Twitter and X AI is the uh artificial intelligence uh program of um rel well it's Grock basically it's Grock you probably heard of Grock the AI company.

[00:09:58]So the these two companies have been merged into SpaceX and plenty of people are saying uh with or without reason, but they're saying that SpaceX overpaid and now by selling SpaceX shares to you the public, you're going to be the the bank holders. Um I don't know. I think uh there's going to be a lot of demand for the shares, but I'm not making up my mind whether I'm going to buy or sell them because what do we care whether it's worth what it's they say it's worth it. All people care about is whether they're going to make money. And I think that's going to create a a lot of speculation. Uh but of course the question will be if it goes up on the day of issue, which is often the case for new IPOs, how long will that premium last and will it last forever? So you might have a little bit of a game about trying to judge when you get out. Um so you will have a chance to get the shares by the sound of it with the public allocation being about 30%.

[00:10:52]Uh I talked a bit about the uh Middle East crisis where it's not resolving itself yet although some ships are getting through the straight of Hormuz but we've also got uh over the weekend a slight escalation and I wouldn't say slight an escalation in the Ukraine Russia war. Um nothing to say about that other than you can look it up yourself.

[00:11:15]Looking at the trading, uh, bond yields came off slightly last week on the back of the promise that the Straight of Hormuz negotiations and the negotiations with Iran were nearly done. Now, we know they're nearly not started. Um, but as of this morning, the US 10-year yield is well above 4.5. It's 4.556%.

[00:11:37]The 30-year yield is 5.063% above 5%. In the UK, the 10-year yield is heading towards 5% is at 4.91 and the 30-year yield is already above four five and a half at 5.57.

[00:11:52]Japan, uh, the 10ear is at 2.69% and the 30-year is heading towards 4%. I think it might have just gone over 4% briefly a couple of days ago, but 30 year is at four. Well, no, not four, it's at 3.93%.

[00:12:07]Uh, oil is down. Uh people are still uh hoping for some sort of resolution of the um the straight of Hormuz crisis and some ships are getting through. So oil is WTI is at 9240 and Brent is at 96 and there's some serious backquidation in the futures. Backquidation means that the price to buy it in the future is less than the price today. So if I'm buying oil today, I might have to pay $96. But if I'm buying it for delivery in maybe June, I might only have to pay $90. That's called backquidation when the price in the future is lower than the price today.

[00:12:49]>> Cuz usually prices are higher in the future, aren't they?

[00:12:51]>> Yes.

[00:12:52]>> Gold this morning is rising nicely. Uh it's up $49 or 1.12%.

[00:12:59]It's at $4,553.

[00:13:03]Um not showing any signs of breakout yet.

[00:13:06]>> What's a breakout? uh when it moves above a certain moving average like the 200 day above the 200 day moving average or the 50-day moving average. So uh or ch there's often they draw lines on the charts uh between two tops. So they then when it breaks the when it breaks the line so you've got two two peaks one there and one there. You draw a line between the two and then when it when it goes through that line you say it's broken out >> and that means it's going to go higher mostly.

[00:13:35]Um, so gold at 453, not showing a breakout yet. Silver at 77.57, up nicely today. Uh, that's $26 higher or 2.73% higher. Platinum at 1946 is up $31, up 1.66%.

[00:13:55]Palladium at 1373 is up $26 at one up 1.3. No, up 1.97%, sorry. Uh in Japan the Nikki index which is just closing or has just closed uh is 65037 up 935 points or 1.47%.

[00:14:16]The Cosby is also up half a percent. The Hangen index up nearly 1%. In Europe which has just opened all the European bores are opening higher. Um so the DAX in Germany is up 1.19. The CAT current is up 1.48 48 and in Australia the ASX index is up 0.37%.

[00:14:39]Um just a small comment on my little trop books. I'd like to thank those of you who bought them. Uh this is a series of children's books for children to um help them understand finance through stories. Uh there was a lady uh I won't say her name did a little post about it on social media and for a very brief moment one of my books moved into the top 100 books for children about finance. Um so thank you very much for whoever it was. Well, I can't remember your name. Um I won't say it either, but thank you very much for posting about the book. It was unsolicited and much appreciated. I really uh am pleased about that. Uh, so if you like these types of videos with the daily stock market updates, please like and subscribe and thumbs up and what you have to ring the little no, hit the little bell, haven't you? So, we'll say bye-bye now. Bye-bye, everybody. Bye.