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Daily Update — May 14, 2026

War Impact on PMI; Compute Sovereignty; and Systemic Risk from Private Credit

Today is Thursday, May 14, 2026, and here’s your curated selection of Essential Intelligence on global markets from S&P Global. Subscribe to be notified of each new Daily Update.

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Economy

Global PMI: Europe hit hardest by war impact in April

 

Developed economies struggled during April amid uncertainty, shortages and inflation generated by the ongoing Middle East war. Hardest hit was the eurozone, where output fell for the first time in 16 months. A decrease in services activity outweighed improved manufacturing performance. Germany, France and Spain experienced declines, while Italy saw a marginal increase in business activity.

 

In contrast, growth rebounded in the US and UK, with the latter recording the strongest upturn among major developed economies, driven by improved performance across goods and services. The US expansion was the second-weakest in 14 months, however, as sluggish services growth offset manufacturing’s best performance in four years. Japan lagged the UK but outperformed the US despite growth dipping to a four-month low. Although Japan’s factory output grew at its fastest rate in over 12 years, the country recorded the smallest rise in services output in nearly a year.

Artificial Intelligence

Compute sovereignty: The strategic importance of digital infrastructure

 

Digital sovereignty, or the ability of a government or organization to control its digital destiny without external influence or dependence, has been part of the IT landscape since the emergence of cloud computing. National and regional sovereign cloud initiatives have arisen to address growing concerns about operational control, data locality and jurisdictional governance. However, the transformative power of AI raises the stakes: AI models, platforms and underlying infrastructure — including data centers, clouds, servers and chips, metals and minerals, and energy and power — hold economic, political and strategic significance in an increasingly AI-driven economy.

 

Digital sovereignty has become a major strategic issue for companies and countries seeking to control their data, infrastructure and AI future in a landscape characterized by geopolitical volatility, trade disruption, Big Tech dominance and fracturing trust. Momentum toward digital sovereignty, and compute sovereignty in particular, appears unstoppable, as it enables technology independence, economic competitiveness and strategic autonomy.

Private Markets

Pressure Points To Watch For Potential Systemic Risk From Private Credit

 

Investor redemptions and the potential for AI disruption are putting private credit under fresh scrutiny. Still, these stresses are unlikely to pose a systemic risk to the financial sector or the broader economy. Exposure to private credit, particularly among systemically important banks and insurers, is limited and generally well managed. However, as the market expands, so does the potential for risk.

 

Concerns about disruptions in the software sector have contributed to significant outflows and redemptions from semi-liquid business development companies (BDCs) and private credit funds, given their concentrated software exposure. Redemption limitations announced by BDCs indicate that the structures managing liquidity mismatches between assets and liabilities are functioning as intended. However, the longer redemptions remain elevated, the more likely BDCs' portfolios will be under pressure as managers sell more liquid assets to meet liquidity needs.

In case you missed it

  • Indian rice exporters expressed concerns about a possible rise in domestic fuel prices, which could worsen truck shortages, increase logistical costs and escalate input costs for rice.
  • Uzbekistan Airports said May 8 that it had signed a memorandum of understanding with Allied Biofuels for the supply of sustainable aviation fuel and e-SAF, starting in 2030.
  • Asian steelmakers are accelerating efforts to comply with the EU's Carbon Border Adjustment Mechanism as the announcement of a clear carbon price under the regime and tightening import restrictions begin to reshape export economics, trade flows and pricing structures.

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