Preview

Markets opened Friday on a cautious note as optimism over a U.S.-China tariff truce faded under the weight of lingering economic uncertainty. U.S. futures were little changed, while Japanese GDP data disappointed and Walmart flagged inflationary pressures tied to tariffs. A Bloomberg survey revealed Trump-era tariffs on Chinese goods are likely to persist at 30% through late 2025, threatening export flows and dampening China’s growth outlook. Still, Barclays scrapped its U.S. recession forecast, lifting 2025 growth expectations to 0.5% amid improved trade sentiment. In equities, Richemont beat sales forecasts thanks to robust U.S. jewellery demand, offsetting weakness in Asia. Meanwhile, Coinbase shares tumbled after a $400 million data breach linked to bribed offshore agents, just days after the company joined the S&P 500. With macro signals mixed and geopolitical risks mounting, investors are rotating cautiously, favoring resilient sectors and monitoring sentiment and security developments closely.

Market Caution Returns as Trade Optimism Fades

U.S. equity futures hovered near flat early Friday, reflecting a cautious tone across global markets as investors digest conflicting economic signals. Futures on the Dow Jones Industrial Average rose 0.09%, while the S&P 500 was unchanged and Nasdaq 100 futures dipped 0.02%. Thursday’s trading was marked by muted gains eroded by concerns over the economic drag from President Trump’s tariffs, despite initial optimism from a partial rollback agreement with China. Walmart’s earnings underscored inflationary pressures, warning of “unavoidable” price hikes. Meanwhile, in Asia, markets traded mixed following a sharper-than-expected 0.7% annualized contraction in Japan’s Q1 GDP, casting doubt on regional growth momentum ahead of key economic releases. Investors are now eyeing the University of Michigan’s consumer sentiment data for further insight into domestic resilience.

Investment Insight: Despite temporary relief on the trade front, markets remain vulnerable to lingering tariff effects and softening economic data. Investors should maintain a defensive posture, prioritizing sectors resilient to inflation and geopolitical noise, while closely monitoring consumer sentiment as a leading indicator for broader spending trends.

Tariff Uncertainty Weighs on China Outlook as U.S. Maintains Pressure

Markets are bracing for prolonged trade tensions after a Bloomberg survey showed U.S. tariffs on Chinese goods are likely to remain at 30% through late 2025, despite the recent 90-day truce between Washington and Beijing. Analysts warn the elevated levies—significantly lower than peak levels but still punitive—could erase up to 70% of Chinese exports to the U.S. in the medium term. The survey underscores low expectations for substantial progress in negotiations before the 2026 U.S. midterm elections. Chinese industrial output is forecast to slow to 5.9% in April, down from 7.7% in March, with export softness and weakening factory activity already reflecting the tariff impact. While the yuan is expected to stabilize near 7.2 per dollar, Chinese equities and bond yields are seen trading in tight ranges as policy uncertainty tempers investor enthusiasm.

Investment Insight: Persistent tariff headwinds reinforce a cautious stance on Chinese assets, particularly in export-sensitive sectors. With limited scope for near-term policy easing and trade negotiations expected to yield only incremental progress, investors should favor companies with domestic demand exposure and structural growth drivers. Currency stability may offer some relief, but headline risk from U.S. trade policy remains a key volatility trigger through year-end.

Barclays Scraps U.S. Recession Call on Trade Truce Optimism

Barclays has reversed its U.S. recession forecast, citing easing U.S.-China trade tensions as a key driver of improved economic prospects. In a note released Thursday, the bank now anticipates U.S. GDP growth of 0.5% in 2025, compared to a prior projection of a 0.3% contraction. Growth for 2026 was also adjusted modestly higher to 1.6%. The more stable trade environment has also prompted upward revisions for the euro area, with Barclays now expecting flat growth in 2025 instead of a 0.2% decline. However, the bank maintains a cautious stance on Europe, forecasting a shallow technical recession in the second half of the year amid persistent uncertainty around U.S.-EU tariff negotiations.

Investment Insight: The shift in Barclays’ U.S. outlook underscores how pivotal trade sentiment remains for macro forecasts. While risks linger, especially in Europe, reduced recession probability in the U.S. supports a constructive stance on risk assets. Investors may consider selectively adding cyclical exposure while remaining hedged against geopolitical volatility and trade-related setbacks.

Richemont Sales Beat Forecasts as U.S. Jewellery Demand Offsets Asia Weakness

Richemont posted a 7% rise in Q4 sales, slightly ahead of expectations, driven by strong U.S. demand for high-end jewellery despite persistent weakness in Asia. The Swiss luxury group reported €5.17 billion ($5.80 billion) in revenue for the quarter ending March, with its jewellery division—home to Cartier and Van Cleef & Arpels—rising 11%. This helped cushion an 11% decline in watch sales, largely due to subdued demand in China amid ongoing property sector stress. While total growth slowed from 10% in the previous quarter, resilient spending by affluent American consumers provided a buffer against regional volatility.

Investment Insight: Richemont’s results highlight the diverging trajectories within the luxury space, with jewellery outperforming watches and the U.S. market proving more resilient than Asia. Investors should closely monitor regional exposure and category mix when evaluating luxury equities. Names with strong U.S. jewellery franchises may offer relative safety amid macro uncertainty and uneven global demand.

Market price: Campagnie Financière Richemont SA (CFR.SW): CHF 154.90

Preview

Global markets are treading cautiously as investors digest mixed signals from trade diplomacy and economic data. US futures slipped early Thursday, with Dow, S&P 500, and Nasdaq contracts all lower, as optimism over US-China tariff rollbacks was tempered by investor anticipation of fresh inflation and retail sales figures. Japanese investors extended their foreign equity buying streak, signaling confidence in global risk assets despite lingering trade uncertainty. Meanwhile, the Bank of Japan is expected to hold rates through September, delaying further tightening in response to Trump’s tariff moves. In corporate news, Boeing shares edged higher after securing a record $96 billion jet deal with Qatar during Trump’s Middle East tour, while Supermicro stock surged 40% this week on a $20 billion AI partnership and bullish technical signals. As the week progresses, market participants will be closely watching economic prints and geopolitical developments for clarity on the direction of monetary policy and global growth.

Futures Dip as US-China Trade Progress Fails to Soothe Market Nerves

US equity futures edged lower Thursday as markets digested the tentative progress in US-China trade talks and braced for fresh inflation and retail data. Dow futures (YM=F) fell 0.59%, S&P 500 futures (ES=F) declined 0.46%, and Nasdaq 100 contracts (NQ=F) slipped 0.50%. The pullback follows a tech-led rally on Wednesday, with Nvidia driving gains amid optimism over AI-related spending and renewed Middle East tech partnerships. Despite easing tariff tensions earlier in the week, investors remain cautious ahead of the April Producer Price Index and retail sales data, which may gauge the resilience of consumer demand under evolving trade dynamics. Meanwhile, Cisco and CoreWeave offered contrasting AI-driven earnings outlooks, reinforcing the uneven terrain in tech valuations.

Investment Insight: Recent volatility underscores the market’s sensitivity to geopolitical developments and inflation data. While AI remains a structural growth driver—evident in Cisco’s upgraded forecast—the broader macro picture, including trade policy swings and inflation metrics, continues to steer sentiment. Investors should maintain selective exposure to AI and tech, while watching for signals in consumer data and producer pricing that could inform the Fed’s rate trajectory and broader equity positioning.

Japanese Investors Sustain Global Equity Push Amid Trade Truce Optimism

Japanese investors extended their foreign equity buying streak to an eighth consecutive week, buoyed by easing global trade tensions and renewed optimism over U.S. tariff policy. Net purchases of overseas stocks totaled ¥250.8 billion ($1.72 billion) for the week ended May 10, according to Japan’s Ministry of Finance—moderating from the previous week’s ¥2.55 trillion but contributing to a record-setting ¥8.2 trillion in net foreign equity acquisitions year-to-date, the highest since comparable data began in 2005. The shift follows significant tariff rollbacks by both the U.S. and China and a new U.S.-UK trade pact, which have helped lift the MSCI World Index nearly 21% from its April low. Japanese investors also returned to long-term overseas bonds with ¥1.92 trillion in net inflows, reversing prior outflows, while foreign capital continued to flow into Japanese stocks for a sixth straight week.

Investment Insight: The sharp appetite for foreign risk assets among Japanese investors signals growing conviction in a soft-landing scenario for global growth amid de-escalating trade tensions. The sustained demand for overseas equities and bonds suggests a strategic pivot toward yield and diversification as domestic returns remain constrained. Investors should monitor Japanese flows as a bellwether for confidence in global markets, particularly as cross-border capital reallocations may accelerate if inflation data and trade diplomacy continue to stabilize.

Boeing Lands Record $96 Billion Qatar Order Amid Trump’s Gulf Trade Push

Boeing secured its largest-ever widebody aircraft order as Qatar Airways committed to purchasing up to 210 jets in a $96 billion deal announced during President Trump’s diplomatic visit to Doha. The agreement includes firm orders for 130 Dreamliners and 30 777-9s, with options for an additional 50 aircraft. The deal marks a significant boost for Boeing, which has faced production setbacks, labor disruptions, and reputational damage following last year’s 737 Max incident. The broader U.S.-Qatar economic package totals $243 billion, encompassing aerospace, defense, and technology cooperation. Boeing shares rose 0.64% on the news, though investors remain mindful that large-scale aircraft orders are often subject to change. The announcement also highlights the Trump administration’s strategy of leveraging high-profile corporate deals to underpin its evolving trade diplomacy.

Investment Insight: The Qatar order signals a turning point for Boeing’s commercial recovery and underscores the strategic role of state-backed airline demand in stabilizing aerospace supply chains. While political optics may cloud the narrative, the scale of the deal positions Boeing to regain delivery momentum and improve cash flow visibility. Investors should weigh the long-term value of this backlog against ongoing geopolitical risks and supply-side constraints, particularly as the administration uses aircraft orders as trade levers in a broader economic realignment.

Market price: Boeing Co (BA): USD 204.72

BOJ Seen Holding Rates Through September as Tariff Uncertainty Clouds Outlook

The Bank of Japan is expected to pause its tightening cycle through the third quarter amid rising uncertainty from U.S. trade policy, according to a Reuters poll of economists. A resounding 95% of respondents forecast no rate change at the BOJ’s June meeting, while 67% now see borrowing costs remaining at 0.50% into September—nearly double the share from April. Despite the pause, just over half of economists still expect at least one 25-basis-point hike by year-end. The shift reflects growing concern over the economic drag from President Trump’s newly imposed tariffs, which include a looming 24% levy on Japanese exports starting in July. BOJ officials, including Deputy Governor Shinichi Uchida, have maintained a cautiously optimistic tone, pointing to continued wage growth and inflation momentum, though the pace of rate normalization may slow as global trade dynamics evolve.

Investment Insight: The BOJ’s expected hold underscores how geopolitical risk is increasingly shaping monetary strategy. With Japanese policymakers prioritizing stability amid external shocks, investors should temper expectations for near-term rate hikes. The yen’s trajectory, capital flows, and equity valuations may remain sensitive to trade negotiations and U.S. tariff enforcement. For fixed income investors, the extended pause could support JGB demand, while equity investors may focus on domestic demand resilience as a buffer against export-driven volatility.

Preview

Coinbase’s 24% surge on S&P 500 inclusion marks a turning point for the crypto industry, signaling rising institutional acceptance amid easing regulatory pressures under the Trump administration. BYD overtakes Toyota as Singapore’s top car brand in 2025, reflecting the EV maker’s aggressive global expansion. Foxconn posts a 91% profit jump in Q1, driven by soaring AI server demand, while US soybean exports face a potential 20% decline without a China trade deal, highlighting ongoing trade risks. Nvidia sparks a tech rally as easing inflation and a US-China tariff truce lift Wall Street, with the S&P 500 erasing its 2025 losses. Bitcoin crosses $100,000, reinforcing optimism in digital assets, while BYD’s success underscores the EV market’s rapid growth in Southeast Asia. Investors are urged to monitor key earnings, trade negotiations, and AI-driven opportunities as markets remain sensitive to geopolitical and macroeconomic shifts.

Trade Truce Sparks Optimism Across Markets

US stock futures continued their upward momentum on Wednesday, buoyed by a 90-day tariff truce between the US and China and April’s cooler-than-expected inflation data. Futures on the Dow Jones Industrial Average, S&P 500, and Nasdaq 100 rose 0.1%, 0.1%, and 0.2%, respectively, as easing trade tensions lifted sentiment. Nvidia led a tech rally on Wall Street, driving the S&P 500 to erase its year-to-date losses. In Asia, markets showed mixed openings but gained traction throughout the day. The Hang Seng Index surged 1.7%, and China’s CSI 300 advanced 1.1%, while Japan’s Nikkei 225 slipped 0.3%. Meanwhile, macroeconomic uncertainty weighed on corporate earnings, with American Eagle pulling its guidance and disappointing investors.

Investment Insight: The easing of US-China trade tensions and subdued inflation are potential tailwinds for equities, particularly in the tech sector, as seen in Nvidia’s rally. However, lingering macro risks, as highlighted by corporate guidance withdrawals, suggest a cautious approach. Investors should monitor upcoming earnings for signs of resilience and focus on sectors less exposed to global trade volatility.

US Soybean Exports Threatened by Trade Uncertainty

US soybean exports face a potential 20% decline in the absence of a US-China trade deal, according to AgResource. Exports could drop to 1.5 billion bushels, significantly below the USDA’s forecast of 1.865 billion, as Chinese tariffs—even reduced—keep US soybeans uncompetitive against Brazil’s record harvest. Farm gate prices may slide to $9.10 per bushel for 2025/26, compared to the USDA’s $10.25 forecast, pressuring US farm income. While a temporary tariff truce offers slight relief, Brazil’s dominance as China’s top soybean supplier, with ample supplies and lower prices, reinforces American farmers’ challenges in regaining market share.

Investment Insight: The ongoing US-China trade tensions underscore risks for US agricultural markets, with soybeans particularly vulnerable. Investors should monitor developments in trade negotiations and consider exposure to Brazil’s agricultural sector, which stands to benefit from China’s growing demand. Diversifying across commodities and geographies may offer a hedge against sustained trade uncertainty.

Preview

Gold steadied near $3,240 as US-China trade optimism pressured haven demand, with the dollar and Treasury yields climbing. Meanwhile, Honda slashed its profit forecast by 59%, citing tariffs and weak EV demand, while delaying its Canada EV plans. Chinese markets retreated as concerns grew over stalled stimulus following the tariff truce, though the yuan hit a six-month high. Boeing gained traction as China lifted its delivery ban on US-made jets, signaling progress but leaving uncertainties tied to the 90-day trade reprieve. Bond markets shifted focus to inflation data, with 10-year yields rising to 4.47% as recession fears faded, reducing expectations for near-term Fed rate cuts.

Gold Steadies Amid US-China Trade Optimism

Gold prices stabilized near $3,240 an ounce after Monday’s 2.7% drop, as easing US-China trade tensions shifted investor focus toward riskier assets. The temporary tariff reductions—slashing US duties on Chinese imports to 30% and Beijing lowering levies to 10%—sparked a rally in the US dollar and Treasury yields, pressuring the non-yielding metal. While gold remains nearly 25% higher year-to-date, traders recalibrated expectations for Federal Reserve rate cuts, further tempering bullion’s appeal. Analysts caution that uncertainty persists over the durability of the trade truce, leaving room for volatility in gold markets.

Investment Insight: Gold’s pullback highlights the metal’s sensitivity to shifts in macroeconomic sentiment. Investors should monitor the sustainability of US-China trade progress and its impact on risk assets. A cautious stance may be prudent, with gold consolidating between $3,150 and $3,350 an ounce, offering potential entry points amid geopolitical uncertainties. Diversifying into silver and platinum could also balance portfolios as industrial demand rises.

Honda Slashes Profit Forecast as Tariffs and EV Demand Weigh

Honda Motor expects a 59% drop in operating profit for the fiscal year ending March 2026, projecting ¥500 billion ($3.38 billion) compared to ¥1.21 trillion last year. The automaker cited U.S. tariffs on foreign-made vehicles and rising competition from Chinese EV manufacturers as key headwinds. Additionally, Honda will delay its plans for an EV supply chain in Ontario, Canada, by two years, attributing the pause to sluggish EV demand. Despite the challenges, Honda shares rose 1.01% in Tokyo trading, reflecting broader market optimism.

Investment Insight: Honda’s forecast underscores the pressure traditional automakers face from geopolitical policies and the rapid rise of Chinese EV players. Investors should assess the long-term viability of legacy automakers’ EV strategies amid evolving trade dynamics and market shifts. Honda’s decision to delay its Canadian EV supply chain signals potential challenges in scaling EV production profitably, emphasizing the importance of diversification in the sector.

Chinese Markets Retreat as Trade Optimism Fades

Chinese stocks slid on Tuesday, with the Hang Seng China Enterprises Index (^HSCE) falling 1.9% after a 3% rally the previous session. Investors grew concerned that the US-China tariff truce might curtail Beijing’s willingness to implement further stimulus measures, dampening hopes for stronger economic support. Onshore, the CSI 300 Index (000300.SS) gave up early gains, reflecting caution over the lingering impact of US import duties and the potential for renewed trade tensions. The yuan, however, climbed to a six-month high, signaling confidence in currency stability despite uncertainties surrounding the 90-day tariff reprieve.

Investment Insight: The selloff highlights investor skepticism about the durability of the US-China trade deal and its implications for Chinese economic policy. While improved sentiment has driven short-term rallies, concerns about corporate earnings and constrained stimulus could weigh on equity performance. Investors should brace for volatility in Chinese markets, balancing exposure with sectors less sensitive to trade policy while monitoring signs of further fiscal or monetary support from Beijing.

Preview

Global markets rallied as the U.S. and China agreed to reduce tariffs and pause new duties for 90 days, lifting equities and oil prices while easing recession fears. S&P 500 and Nasdaq futures surged, and Brent crude rose over 3%, signaling renewed optimism for global trade. Meanwhile, Asian pharma stocks slid after Donald Trump pledged steep U.S. drug price cuts, raising regulatory risks for the sector. In South Asia, Pakistani and Indian stocks soared following a ceasefire, shifting focus back to growth prospects. On the tech front, Bank of America reaffirmed a bullish outlook for AI capex in 2025, with Nvidia and Broadcom identified as top beneficiaries of robust hyperscaler spending.

Markets Rally as U.S. and China Agree to Tariff Reductions and 90-Day Pause

Global markets surged after the U.S. and China reached an agreement to cut tariffs and implement a 90-day pause in their trade dispute. The U.S. reduced tariffs on Chinese imports to 30%, while China’s duties on U.S. goods fell to 10%. S&P 500 and Nasdaq futures jumped 2.8% and 3.6%, respectively, with Europe’s STOXX 600 gaining 1%. The dollar strengthened, rising 1.1% against the yen, while 10-year U.S. Treasury yields climbed 6 basis points to 4.435%.

Analysts described the move as a “step in the right direction,” boosting risk sentiment and easing concerns over global supply chain disruptions. However, the temporary nature of the agreement suggests further volatility if a final deal is not reached.

Investment Insight

The tariff reduction and market rally create opportunities in equities, particularly in export-driven sectors and Chinese ADRs. However, the 90-day pause is a reminder of ongoing uncertainty. Investors should remain cautious, prioritizing companies with resilient supply chains. Diversifying into high-quality bonds or U.S. dollar assets may mitigate risks from potential volatility as negotiations continue.

Trump’s Drug Price Pledge Rattles Pharma Stocks

Asian pharmaceutical stocks slid on Monday as former President Donald Trump vowed to slash US drug prices by up to 80%. Trump’s proposed executive order would impose a “most favoured nation” policy, capping US drug prices at the lowest rates available globally.

Shares in Samsung Biologics, SK Biopharmaceuticals, and BeiGene dropped 4%, 2.5%, and 7.9%, respectively, while Sun Pharma led losses in India, falling over 5%. The pharmaceutical industry, which has historically opposed such measures, warned the move could stifle innovation and undermine research funding. Trump dismissed these claims, signaling a tough stance against industry lobbying. The announcement echoes prior efforts during his presidency, which were blocked by legal and political resistance.

Investment Insight

Trump’s renewed focus on drug pricing could heighten regulatory risk for pharmaceutical stocks, particularly those with significant US exposure. Investors should monitor developments closely, as the proposed “most favoured nation” policy may pressure margins and disrupt global pricing strategies. Diversification into healthcare sectors less reliant on drug pricing, such as medical devices or diagnostics, could provide a strategic hedge.

Pakistani, Indian Stocks Surge Amid Ceasefire Optimism

Markets in Pakistan and India rallied sharply after a ceasefire agreement over the weekend eased geopolitical tensions. Pakistan’s KSE-30 Index soared 9.2%, triggering a brief trading halt, while India’s NSE Nifty 50 Index climbed 3%.

Investors are pivoting back to economic fundamentals, with India’s growth prospects buoyed by anticipated US trade deals and potential rate cuts, while Pakistan eyes IMF funding and domestic reforms. The Indian rupee gained 0.9% offshore, and volatility gauges eased, signaling a positive shift in sentiment. However, lingering doubts over the truce’s durability could temper gains, as reports of violations surfaced shortly after the agreement.

Investment Insight

The ceasefire offers a tactical opportunity for investors to capitalize on renewed momentum in South Asian markets. In India, sectors tied to domestic growth, such as financials and infrastructure, stand to benefit from foreign inflows and improving liquidity. For Pakistan, IMF disbursements and structural reforms could support a medium-term recovery, particularly in undervalued equities. Caution is warranted, however, as geopolitical risks remain a potential overhang.

Preview

Asian markets surged Friday, with Japan’s Nikkei and Taiwan’s benchmark rallying on U.S.-UK trade optimism, while Bitcoin reclaimed $100,000, nearing its $109,000 record high. TSMC posted record April sales as customers rushed orders ahead of looming U.S. tariffs, highlighting the chipmaker’s reliance on AI-driven demand despite tariff risks. Meanwhile, Mitsubishi Heavy projected 10% profit growth this year, driven by robust defence demand, though U.S. tariff uncertainty persists. In China, slowing export growth and factory activity contraction underscore the economic toll of U.S.-China trade tensions as talks loom this weekend. Investors face a complex landscape of geopolitical risks and opportunities.

Asian Markets Surge on Trade Optimism; Bitcoin Nears All-Time High

Asian equities rallied Friday as Japan’s Nikkei rose 1.7% and Taiwan’s benchmark gained 1.8%, driven by optimism surrounding a U.S.-UK trade deal and its potential implications for broader tariff reductions. Technology stocks led gains, while MSCI’s Asia-Pacific index climbed 0.4%. U.S. crude extended its 3% Thursday surge, while Bitcoin soared to $103,909.17, its highest since January, amid strong inflows into crypto ETFs and whale buying. However, caution prevailed as the U.S.-UK deal left critical tariffs intact, tempering expectations for Sino-U.S. trade talks this weekend. Meanwhile, the dollar index touched a one-month high, supported by rising Treasury yields.

Investment Insight: While the U.S.-UK trade deal offers limited immediate economic impact, it signals a pro-trade stance that could buoy market sentiment in the near term. Investors should monitor developments in Sino-U.S. negotiations, as constructive signals could further propel equities, particularly in export-sensitive sectors. Bitcoin’s rally highlights the growing institutional inflows, suggesting potential upside, but caution is warranted near resistance levels. Diversified exposure across equities, commodities, and digital assets remains prudent amidst evolving trade and macro dynamics.

Mitsubishi Heavy Projects 10% Profit Growth on Defence Strength

Mitsubishi Heavy Industries (MHI) forecasted a 9.6% rise in operating profit to 420 billion yen ($2.9 billion) for the fiscal year ending March 2026, driven by robust demand in its aerospace and defence segment, which is expected to grow 40%. Energy systems are also slated for a 17% profit increase. This follows a 35.6% profit growth last year, though pretax earnings of 374.5 billion yen fell short of the 401.6 billion yen analyst consensus. The company noted its guidance does not account for potential impacts from U.S. tariff policies, maintaining a cautious outlook.

Investment Insight: Mitsubishi Heavy’s strong positioning in defence and energy systems highlights resilience against global macro uncertainties. Investors may find value in the company’s growth trajectory, particularly in defence amid rising geopolitical tensions. However, ongoing U.S. tariff risks warrant close monitoring, with potential implications for profitability. Diversifying within industrials and defence-focused equities could mitigate sector-specific volatility.

Market price: Mitsubishi Heavy Industries Ltd. (TYO: 7011): JPY 2,732

China’s Exports Slow as Tariffs Bite, Trade Talks Loom

China’s export growth slowed to 8.1% in April, down from 12.4% in March, as U.S. tariffs of up to 145% on Chinese goods took effect. Exports to the U.S. fell 2.5%, while imports from the U.S. dropped 4.7%. The trade war’s toll is evident, with China’s factory activity contracting at its fastest pace in 16 months and U.S. growth turning negative in Q1. This weekend’s Geneva talks between U.S. and Chinese officials hold slim prospects for a breakthrough, with tariff reductions and export controls on the table. Meanwhile, China’s reliance on exports to the U.S., which accounted for 14.7% of its total goods exports last year, underscores the stakes for both economies.

Investment Insight: The persisting U.S.-China trade tensions add a layer of uncertainty for global markets. Investors should consider reallocating towards sectors less exposed to trade disruptions, such as domestic-focused industries or companies with diversified supply chains. Additionally, watch for potential easing measures from Beijing, as China may roll out stimulus to counteract trade-related slowdowns. Defensive strategies remain prudent amid heightened geopolitical and economic risks.

Preview

US stock futures rallied on optimism surrounding a potential US-UK trade deal, with the Dow, S&P 500, and Nasdaq futures climbing up to 1%. Meanwhile, the Trump administration’s plan to repeal Biden-era AI chip export restrictions drove semiconductor stocks higher, with Nvidia gaining 3.1%. In China, steel exports are expected to drop by 20% in Q2 due to trade war tariffs, further pressuring domestic oversupply and prices. Utility stocks outperformed the S&P 500 as robust power demand—up 5.5% year-over-year—defies fears of a recession, bolstered by data center expansion and manufacturing growth. Toyota forecast a 21% profit decline for FY2025, citing US tariffs, a strong yen, and rising costs, despite steady hybrid demand. Investors are watching closely for trade developments, infrastructure trends, and sector-specific challenges as volatility persists across global markets.

Futures Rally on US-UK Trade Deal Optimism

US stock futures climbed Thursday morning as investor sentiment surged following President Donald Trump’s announcement of a trade deal with a “major trading partner,” widely believed to be the United Kingdom. Dow Jones Industrial Average futures rose 0.6%, while S&P 500 and Nasdaq 100 futures gained 0.7% and 1%, respectively. Investors are also eyeing upcoming US-China trade talks scheduled for this weekend, though Trump confirmed tariffs on China would remain in place for now. Key economic data, including weekly jobless claims and inflation expectations, will also shape market direction. In earnings news, Warner Bros. Discovery and Peloton are set to report results before the bell.

Investment Insight: Investors should monitor developments in US-UK trade relations, as a finalized deal could boost transatlantic economic activity and support equities, particularly in trade-sensitive sectors like industrials and technology. Additionally, with US-China talks on the horizon, any progress could further alleviate trade uncertainties, providing upward momentum for global markets. Balancing optimism with caution remains critical, as macroeconomic data and geopolitical risks continue to influence short-term volatility.

Trump Administration Overhauls AI Chip Export Rules

The Trump administration is set to repeal the Biden-era AI Diffusion Rule, a sweeping policy that imposed global restrictions on chip exports, including countries outside China. While the move will maintain strict measures against Beijing, it signals a shift toward a more transactional approach, with bilateral agreements likely to guide chip access for nations like the UAE and Saudi Arabia. Semiconductor stocks rallied on the news, with Nvidia climbing 3.1% and the Philadelphia Semiconductor Index gaining 1.7%. The policy overhaul, aiming to simplify regulations, may provide relief to tech companies like Nvidia and Oracle, while creating fresh uncertainty for global AI trade dynamics.

Investment Insight: The rollback of the AI Diffusion Rule could unlock growth opportunities for US semiconductor companies in non-China markets, particularly in regions with high AI investment ambitions, such as the Middle East. Investors should monitor Trump’s forthcoming bilateral chip accords, which may create favorable conditions for firms with exposure to these markets. However, tighter enforcement on diversion hotspots like Malaysia and Thailand highlights the need for caution, as geopolitical risks and shifting trade policies continue to influence the sector’s outlook.

Trade War Pressures China’s Steel Industry Amid Slumping Exports

China’s steel exports are forecast to decline by up to 20% in the second quarter, as the US-China trade war and global protectionist measures slash overseas demand. Key markets like South Korea and Vietnam have imposed duties to block rerouted Chinese steel, while US tariffs have disrupted transshipment trades. Analysts warn this will aggravate domestic oversupply, depressing prices and steelmaker margins, with further repercussions expected in downstream sectors like electric vehicles and appliances. The industry, already grappling with weak property sector demand, faces increasing pressure as second-quarter domestic demand seasonally slows.

Investment Insight: Investors in commodities and steel-related industries should brace for heightened volatility as China’s steel oversupply weighs on global prices. The trade war’s ripple effects, particularly on downstream sectors reliant on steel, could further dampen economic activity in related industries. Diversification into markets less exposed to trade tensions or oversupply risks, such as alternative metals or renewable energy infrastructure, may provide a more resilient investment strategy.

Utility Stocks Shine Amid Surging Power Demand

Utility stocks have outperformed the S&P 500 this year, with the Utilities Select Sector ETF (XLU) up over 6%, compared to a 4% decline in the broader index. Robust power demand—up 5.5% year-over-year—continues to defy recession fears, driven by industrial expansion in manufacturing and data center growth fueled by the AI boom. Utility companies, less exposed to tariff uncertainties, are benefitting from strong investment in US infrastructure. Major players like Duke Energy (+13% YTD) and Southern Company (+12% YTD) are positioned for sustained growth, with Duke projecting record infrastructure development over the next decade.

Investment Insight: Utilities offer a defensive play in uncertain markets, combining stable demand with growth tailwinds from industrial electrification and AI-driven data center expansion. With power-intensive sectors like semiconductors and advanced manufacturing bolstering demand, utility stocks remain attractive for income-focused investors seeking resilience amid broader market volatility.

Preview

US-China trade talks scheduled in Geneva have lifted market sentiment, with US futures rising and Asian equities rallying. Oil prices continued their upward trend, nearing $60 per barrel, supported by optimism over trade and shrinking US crude inventories. However, hedge fund billionaire Paul Tudor Jones remains bearish, predicting fresh market lows as high tariffs and interest rates weigh heavily on stocks. Meanwhile, Palantir shares sank 15%, despite strong earnings, as investors balked at its lofty valuation. In Hong Kong, CATL prepares for a $5 billion listing—potentially the largest in four years—offering a modest discount to its Shenzhen-listed shares, signaling confidence in global demand for EV supply chain investments. Investors face a volatile landscape, with defensive strategies and selective positioning remaining key.

Futures Rise as US-China Trade Talks Rekindle Optimism

US stock futures edged higher on Wednesday, with the Dow, S&P 500, and Nasdaq Composite futures gaining 0.56%, 0.60%, and 0.65%, respectively, following the announcement of US-China trade talks. Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer are set to meet Chinese officials in Geneva this weekend, marking the first high-level dialogue since the US escalated tariffs to 145% on Chinese imports. Asian markets rallied on the news, aided further by China’s monetary easing measures aimed at offsetting tariff impacts. Meanwhile, oil prices advanced, with WTI approaching $60 per barrel, amid trade optimism and supply constraints. Investors remain cautious ahead of the Federal Reserve’s policy update later today, as Chair Jerome Powell’s commentary will gauge the central bank’s stance amid growing trade and economic uncertainty.

Investment Insight: The rekindling of US-China trade talks could provide a short-term boost to market sentiment, particularly for export-reliant sectors and commodities like oil. However, uncertainty around the outcome of these negotiations suggests investors should remain selective, focusing on defensive plays and companies with minimal exposure to tariff headwinds. Diversifying into international equities, particularly in regions benefiting from China’s stimulus measures, may also mitigate risk while capturing upside potential.

Paul Tudor Jones Predicts Fresh Market Lows Despite Possible Trade Easing

Hedge fund titan Paul Tudor Jones expects US stocks to hit new lows, even if trade tensions with China ease. Speaking on Tuesday, he highlighted pressure from escalating tariffs and high interest rates, asserting that neither the White House nor the Federal Reserve is likely to relent without another steep market decline. Jones estimated that while investors anticipate a reduction in tariffs to around 50%, the remaining duties would still act as a major drag on US GDP, comparable to the largest consumer tax hike since the 1960s. With the Fed expected to hold rates steady this week, Jones believes a policy shift from Trump or the central bank will only come after markets bottom out. Other institutions, including Wells Fargo and HSBC, echoed cautious outlooks, citing ongoing risks from trade and slowing growth momentum.

Investment Insight: Investors should brace for heightened volatility, as policy inertia on tariffs and rates creates a challenging environment for equities. Defensive positioning in sectors resilient to global trade disruptions, alongside increased cash allocations, could mitigate downside risk. For opportunistic investors, potential market lows may open attractive entry points for high-quality undervalued assets once policy catalysts emerge.

CATL Eyes $5 Billion Hong Kong Listing with Modest Discount

Chinese battery giant CATL is preparing for a $5 billion Hong Kong listing, potentially the largest in the city since 2021. According to sources, the stock may be offered at a discount of less than 10%—likely in the mid-single digits—to its Shenzhen-listed shares. The company aims to secure cornerstone and anchor investors for roughly half of the offering ahead of book building set to begin next week. Final pricing details remain pending, but the modest discount reflects CATL’s confidence in strong demand for its shares amidst growing global interest in electric vehicle supply chains.

Investment Insight: CATL’s strategic move to diversify its investor base via a Hong Kong listing underscores the growing prominence of EV-related sectors. While the modest discount signals robust demand, investors should carefully evaluate valuations relative to existing Shenzhen shares. With cornerstone backing and sector tailwinds, the listing may provide an attractive entry point for long-term investors seeking exposure to EV battery growth.

Preview

Markets are facing a mixed outlook as trade tensions, monetary policy, and sector-specific developments shape sentiment. The dollar strengthened on robust U.S. services data, while S&P 500 futures slipped and Asian shares showed uneven performance. Oil prices rebounded slightly after hitting four-year lows, promising cheaper gas for summer drivers but pressuring energy producers. DoorDash’s $3.9 billion acquisition of Deliveroo highlights consolidation in the food delivery sector, while the DOJ’s push to break up Google’s ad-tech business raises regulatory risks for tech. Investors are navigating a volatile landscape, balancing inflation concerns, trade impacts, and opportunities in defensive sectors.

Dollar Gains as Stock Futures Slip Amid Trade Uncertainty

The dollar edged higher, reversing a two-day decline, as stronger-than-expected US services data signaled resilience in the economy despite ongoing trade tensions. Asian currencies, led by the Taiwanese dollar, saw modest pullbacks following a rally fueled by optimism over potential tariff reductions. Equity futures for the S&P 500 fell 0.4%, while European and Asian markets also showed weakness. Oil prices rebounded, gold rose 0.8% on Chinese demand, and Treasury yields climbed for a third straight session. Investors brace for Wednesday’s Fed decision as the ECB signals continued rate cuts, keeping uncertainty elevated amid trade and monetary policy shifts.

Investment Insight: The market’s cautious tone underscores the continued impact of trade tensions and tariff policy on global asset flows. With US economic data showing resilience in services but weakness in manufacturing, investors should remain defensive, focusing on quality assets with limited exposure to trade-sensitive sectors. Gold and Treasury yields reflect a flight to safety, signaling the need to balance risk with hedging strategies as volatility persists.

DoorDash Acquires Deliveroo in $3.9 Billion Deal to Expand European Presence

DoorDash has reached an agreement to acquire UK-based Deliveroo for £2.9 billion ($3.85 billion), marking a strategic move to bolster its market share in Europe and challenge competitors like Just Eat and Uber Eats. The deal, priced at 180 pence per share, follows renewed talks between the firms after prior disagreements over valuation. Deliveroo, whose largest markets are the UK and Ireland, will offer DoorDash access to its 10-country network, where DoorDash has minimal presence. Combined, the companies handled $90 billion in orders in 2024. Notably, Deliveroo’s pandemic-era growth has faded, with its stock struggling since a 2021 IPO. The transaction is expected to face minimal regulatory hurdles.

Investment Insight: This deal underscores the consolidation trends in the food delivery sector as firms seek scale in a fiercely competitive, low-margin market. For investors, DoorDash’s acquisition of Deliveroo offers potential long-term growth in underpenetrated European markets. However, attention should remain on profitability challenges in the sector and macroeconomic headwinds, such as inflation and shifting consumer spending habits. Evaluation of synergies and execution risks will be crucial.

Market price: DoorDash Inc (DASH): USD 205.40

U.S. Pushes to Break Up Google’s Ad-Tech Business After Monopoly Ruling

A U.S. federal judge has found Google illegally monopolized online ad-tech markets, prompting the Department of Justice to propose divestitures of its AdX advertising marketplace and DFP ad server. The DOJ argued such measures are necessary to restore competition in ad exchanges and publisher ad servers, critical tools for monetizing digital content. Google, however, opposes the breakup, favoring behavioral remedies like opening real-time bidding to competitors. This case, set for trial in September, follows similar antitrust scrutiny in the EU, where Google’s prior concessions failed to satisfy publishers. Google insists the DOJ’s proposal would harm advertisers and publishers alike.

Investment Insight: The DOJ’s aggressive stance highlights escalating regulatory risks for major tech firms. Investors should monitor the case closely, as a forced breakup could significantly impact Google’s advertising revenue—its primary profit driver. While Alphabet remains a dominant player, regulatory overhang and potential structural changes may weigh on its valuation. Diversification across other revenue streams and sectors with lower regulatory exposure could be a prudent strategy for portfolio resilience.

Market price: Alphabet Inc (GOOG): USD 166.05

Asian Markets Mixed as Wall Street Rally Falters Amid Trade War Concerns

Asian shares showed mixed performance on Tuesday following Wall Street’s first decline in ten sessions. Chinese markets rebounded after the “Golden Week” holiday, with the Shanghai Composite up 1% and the Hang Seng rising 0.7%. However, weaker-than-expected Chinese services data highlighted the toll of escalating U.S.-China trade tensions, including a sharp drop in logistics activity from a 145% tariff spike. Meanwhile, oil prices recovered slightly after hitting four-year lows, with U.S. crude climbing to $58.08 per barrel. Wall Street closed lower, with the S&P 500 dropping 0.6% as tech heavyweights like Apple (-3.1%) and Tesla (-2.4%) dragged the market. Investors remain cautious ahead of Wednesday’s Fed decision, with inflation concerns and global growth risks in focus.

Investment Insight: The mixed market sentiment underscores the fragility of the global economy amid escalating trade tensions and inflationary pressures. Investors should carefully assess exposure to sectors impacted by U.S.-China tariffs, such as technology and consumer goods, while considering opportunities in defensive plays like energy, which may benefit from oil price volatility. With the Fed expected to maintain rates, staying vigilant about inflation data and central bank signals will be critical for navigating near-term market uncertainty.

Preview

Markets face a week of uncertainty as U.S. equity futures dipped 0.7%, crude oil tumbled over 3% on OPEC+ output increases, and the dollar weakened further, boosting Asian currencies like the Taiwanese dollar. Investors await the Federal Reserve’s rate decision, with rates likely to hold steady despite recession risks and political pressure from President Trump. Foxconn reported a 25.54% surge in April revenue, signaling strong electronics demand, while Asian markets were subdued, led by a 0.7% drop in Australia’s S&P/ASX 200 following weak Westpac earnings. Gold prices firmed on dollar weakness but gains were tempered by optimism over U.S.-China trade talks. Key Chinese trade data and inflation reports, along with Fed commentary, will shape sentiment in the days ahead.

US Futures Slide Amid Trade Uncertainty, Oil Tumbles

US equity-index futures retreated 0.7%, threatening the S&P 500’s longest winning streak in two decades, as trade policy uncertainty weighed on markets. The dollar weakened for a second day, sending Asian currencies higher, with the Taiwanese dollar surging 5% in its largest intraday gain in over 30 years. Crude oil plunged over 3% following OPEC+’s announcement of increased output, adding pressure to an already fragile demand environment. European markets remained subdued, and gold advanced amid cautious sentiment. Investors now turn to the Federal Reserve’s Wednesday decision, where rates are expected to hold steady despite calls for cuts. Meanwhile, corporate moves, including Shell’s potential bid for BP and Warren Buffett’s planned retirement, added to market intrigue.

Investment Insight

The weakening dollar and OPEC+ output surge highlight shifting global dynamics, favoring emerging-market assets and pressuring commodities. Investors should monitor the Federal Reserve’s stance for signals on monetary easing, which could further weigh on the dollar and boost risk assets. Balancing exposure to emerging-market equities and defensive plays like gold may provide resilience in this uncertain landscape.

Foxconn Revenue Surges, Signals Q2 Growth Amid Cautious Optimism

Foxconn, the world’s largest contract electronics manufacturer and Apple’s primary iPhone assembler, reported a 25.54% year-over-year revenue increase in April. The company expects continued growth in Q2 compared to last year, though it flagged global political and economic uncertainties as areas requiring close monitoring. Foxconn’s strong performance underscores robust demand for electronics, even as macroeconomic headwinds persist.

Investment Insight

Foxconn’s growth highlights resilience in consumer electronics demand and its strategic position as a key supplier in the global tech ecosystem. Investors should weigh this momentum against potential risks from geopolitical tensions and supply chain disruptions. The stock remains a bellwether for the broader electronics sector, making it a valuable indicator for tech-focused portfolios.

Market price: Hon Hai Precision Industry Co Ltd (TPE: 2317): TWD 142.50

Asia Markets Subdued as Australia Leads Declines on Westpac Weakness

Asian stocks saw muted performance on Monday amid low trading volumes due to public holidays in major markets like Japan, China, and South Korea. Australia’s S&P/ASX 200 dropped 0.7%, weighed down by a 3% decline in Westpac shares after the lender reported a 1% drop in net profit due to tighter margins. Financials fell 1.6%, dragging the broader index lower. Regional markets were cautious ahead of U.S.-China trade talks and key Chinese economic data, including trade balance and inflation reports. Elsewhere, Indonesia’s Jakarta Composite rose 0.4%, while Singapore’s STI and Malaysia’s KLCI showed minimal movement.

Investment Insight

Westpac’s weaker earnings emphasize the challenges Australian banks face amid compressed margins and global trade uncertainties. Investors should remain cautious on financials as geopolitical tensions and macroeconomic instability persist. With key Chinese data expected this week, a focus on economic resilience in Asia may benefit portfolios diversified into sectors less exposed to trade risks, such as domestic consumption and infrastructure.