Staff writersUpdated May 21, 2026 — 5:51pm,first published May 21, 2026 — 5:12amThe Australian sharemarket bounced back from its seven-week low, as pressure from the bond market eased overnight and oil prices fell after President Donald Trump said the US was in the “final stages” of its war with Iran.The S&P/ASX 200 closed 125.10 points, or 1.5 per cent, higher at 8621.70, with eight of its 11 industry sectors in positive territory. Gains solidified after data showed Australia’s unemployment rate has climbed to the highest level since November 2021, suggesting the labour market is cooling faster than anticipated and prompting traders to dial back expectations for further interest-rate increases by the Reserve Bank. The ASX had slumped 1.3 per cent on Wednesday.Wall Street bounced back on Wednesday, ending its three-day losing streak. APThe Australian Bureau of Statistics said the nation’s jobless rate lifted to 4.5 per cent from 4.3 per cent in April. That’s the highest level since the country was dealing with fallout from the COVID-19 pandemic. Total employment fell by 18,600 in the month, with full-time jobs down by 10,700.The RBA, which delivered its third consecutive rise in May to battle inflation, had forecast unemployment would rise to 4.4 per cent in mid-2027. Commonwealth Bank, oil firm Santos and software makers WiseTech Global and Atlassian are among major companies that have announced job cuts this year.“With this jump, the RBA won’t hike again,” said Andrew Lilley, chief rates strategist at Barrenjoey Markets in Sydney. The central bank next meets on June 15 and 16.The Australian dollar slipped 0.6 per cent after the data, and the three-year government bond yield fell as much as 17 basis points, extending an earlier drop. Traders are now wagering about an even chance of a rate rise in August, increasing to fully priced in December.Real estate investment trusts jumped on the prospect of a rate reprieve. Rising interest rates push up bond yields, hurting the appeal of property trusts and driving up borrowing costs for mortgages and loans. Data centre and warehouse owner Goodman Group climbed 2.8 per cent, Westfield landlord Scentre rose 1.7 per cent, Vicinity Centres added 2 per cent and Stockland rose 2.8 per cent.Meanwhile, mining stocks rebounded from Wednesday’s sharp losses, with BHP, the biggest stock on the bourse, jumping 3.1 per cent, while Fortescue rose 0.5 per cent and Rio Tinto advanced 3.2 per cent.Gold miner Northern Star lost 2.1 per cent after managing director Stuart Tonkin announced his intention to stand down in the first quarter of the 2027 financial year. Tonkin’s departure comes as the company continues to struggle with production output at its flagship operation in Kalgoorlie, which has resulted in cuts to its earnings forecasts.This has resulted in Northern Star’s shares tumbling over the past couple of months even as it benefited from high gold prices. Fellow gold miner Evolution Mining was 3.8 per cent higher and Newmont was up 2.2 per cent as gold prices held steady, with optimism over efforts to end the Iran war easing bets on rate increases.Arafura Rare Earths jumped 5.1 per cent after saying it had made a final investment decision to develop its massive Nolans mine in the Northern Territory, which is set to produce about 5 per cent of global rare earths. The Gina Rinehart-backed miner plans to start construction of the mine from September, it said in a statement.Stuart Tonkin will stand down as managing director of Northern Star later this year.Trevor CollensFinancial stocks bounced higher on the improved investor sentiment. The big four banks all moved sharply higher, led by National Australia Bank’s 2.3 per cent gain. Westpac and ANZ rose by 2.2 per cent and 1.6 per cent, respectively, and Commonwealth Bank added 0.9 per cent.Consumer stocks also benefited. Bunnings and Kmart owner Wesfarmers rose 1.4 per cent, electronics retailer JB Hi-Fi jumped 3.4 per cent and furniture seller Harvey Norman rose 2.1 per cent.Piercing shop chain SkinKandy had a solid market debut, jumping 6.8 per cent on its IPO price of $2.20 on its first day trading on the ASX.Energy stocks finished mixed after oil prices inched higher, having slumped by more than 5 per cent overnight as Donald Trump’s comments raised hopes of a near-term restart of energy flows through the critical Strait of Hormuz.Woodside Energy lost 2.1 per cent while Santos added 0.5 per cent. Refiners Ampol and Viva Energy dropped 0.1 per cent and 1.7 per cent, respectively.“One has to take these sorts of headlines with a pinch of salt,” said Fawad Razaqzada, market analyst for global macro at StoneX.“Trump has made so many claims of this nature during this conflict, and invariably the opposite has been true. Let’s see if this time it is different.”Travel-related stocks jumped amid the hopes for an end to the war, which has disrupted their industry, with Qantas shares up 3.1 per cent and Flight Centre gaining 2.7 per cent. Virgin Australia rallied 9.3 per cent after announcing another round of “targeted” cuts to its flight network, following a 1 per cent cut of its flights in April, to save on fuel costs.Oil market participants are increasingly pricing crude to be capped near $US100 a barrel over the next year, as demand is forced to slow down to counter millions of barrels of supply losses caused by the US-Iran war, a Bloomberg Intelligence survey showed.Technology stocks were mixed, with Xero, WiseTech and Technology One losing 2.3 per cent, 0.5 per cent and 2.3 per cent respectively, while AI data centre operator NEXTDC jumped 2.6 per cent.On Wall Street overnight, the world’s most valuable company, Nvidia, disappointed investors with its latest sales forecast after the closing bell in New York, adding to concerns about growing competition in the AI chip industry.Nvidia said revenue in the three months ending in July would be $US91 billion ($127.3 billion). Though analysts estimated $US87 billion on average, projections ranged as high as $US96 billion, according to data compiled by Bloomberg.The outlook disappointed investors who have grown accustomed to Nvidia shattering expectations. The company’s shares fell about 0.5 per cent in after-hours trading.Meanwhile, SpaceX filed publicly for its initial public offering, revealing billions in losses and the super-voting share plan allowing Elon Musk to keep the rocket, satellite and artificial intelligence giant under his control and preventing him from being removed from power against his will.The company known formally as Space Exploration Technologies Corp chose Nasdaq to make its debut under the symbol SPCX, according to a filing with the US Securities and Exchange Commission.The company had a net loss of $US4.28 billion on revenue of $US4.69 billion for the first quarter, compared with a net loss of $US528 million on revenue of about $US4 billion a year earlier, according to its filing.Elsewhere, OpenAI is preparing to file for an initial public offering in the coming weeks and is targeting a public debut sometime in the northern autumn, according to a person familiar with the plan.The ChatGPT creator is working with Goldman Sachs and Morgan Stanley to make a confidential IPO filing as soon as Friday, but the exact timing remains uncertain, the person said, asking not to be identified because the information isn’t public.OpenAI said in a statement: “We regularly evaluate a range of strategic options. Our focus remains on execution.”Overnight, the S&P 500 climbed 1.1 per cent for its first rise in four days. The Dow Jones added 1.3 per cent, and the Nasdaq composite rallied 1.5 per cent.Technology stocks shone. Advanced Micro Devices jumped 8.1 per cent and Intel 7.4 per cent while Nvidia added 1.3 per cent before the release of its results.On the losing side of Wall Street was the US Target, which fell 3.9 per cent even though the retailer reported better profit and revenue for the latest quarter than analysts expected. A new CEO, Michael Fiddelke, is trying to turn around the company and boost its revenue.Expectations were high for the company’s performance after Target’s stock came into the day with a gain of more than 30 per cent for the year so far, quadruple the S&P 500’s gain.Stocks got a lift from easing yields in the bond market, which offered relief following rapid climbs that had rattled stock markets worldwide recently. The yield on the 10-year Treasury fell to 4.57 per cent from 4.67 per cent, which is a significant move for a market that measures things in hundredths of a percentage point.With AP, BloombergThe Market Recap newsletter is a wrap of the day’s trading. Get it each weekday afternoon.More:World marketsWall StreetSharesASX LimitedRBANvidiaIranElon MuskFrom our partners