📆 Thursday, June 6
► European stocks rose ahead of an anticipated interest rate cut by the European Central Bank one day after the Bank of Canada's first rate cut. The ECB is expected to cut rates from 4.5% to 4.25%. The Stoxx 600 index rose over 0.6%, driven higher by tech shares, mirroring gains in the US where the S&P 500 notched its 25th record close this year. Investors are keenly watching ECB President Christine Lagarde for guidance on future monetary policy amidst stronger-than-expected economic growth, inflation, and wage increases. German factory orders fell unexpectedly by 0.2% in April, missing estimates of a 0.3% growth, with domestic and foreign orders showing mixed results.
► US markets remain cautious with futures showing little change following record highs for the S&P 500 and Nasdaq. Investors are awaiting Friday’s jobs report for further economic insights. Yesterday's ADP private payroll data showed hiring grew at the slowest pace this year, while the services sector expanded significantly – a big surprise as analysts expected a significant slowdown in business activity. US Treasury yields are currently higher (+2 bps) after falling sharply yesterday, as markets almost fully priced in two Federal Reserve rate cuts in 2024. The USD retreated as the Bank of Canada cut rates, heightening focus on US monetary policy. In corporate news, Nvidia became the first chip company to reach a $3 trillion market capitalization (surpassing Apple), largely due to the massive surge in AI demand.
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