📆 Friday, May 30
► European markets rise despite increasing trade concerns; Europe benefits from US inflows
European equities are trading higher despite renewed trade jitters from the US. The Stoxx 600 climbed 0.60%, led by Germany’s DAX (+0.95%) and Italy’s FTSE MIB (+0.8%). France’s CAC 40 underperformed and only rose 0.2%, while the UK’s FTSE 100 gained 0.7% . The market was buoyed by fresh $1B inflows into European equity funds, offsetting the $5.1B outflows seen in US markets. Auto and tech stocks saw mild gains as Trump's tariff delays offered short-term relief, though court reversals and inconsistent messaging from Washington kept sentiment restrained. SmartTrader chief analyst Robert Lindner assumes that the Trump administration will not regard the court's decision as binding, or even as a “recommendation”.
► US futures edge lower as markets brace for inflation print and trade fallout
Wall Street futures slipped in premarket trading, with S&P 500 and Nasdaq 100 futures both down about 0.15% following yesterday sharp profit taking that hit many investors which bought heavily following Nvidia's earnings report and after cheering the court's ruling to block Trump's tariffs. Things changed fast (and as we predicted): a temporary court approval of Trump’s reciprocal tariffs reignited concerns about trade escalation. All eyes turned to April’s Core PCE Price Index, the Fed’s preferred inflation gauge, which could determine the likelihood of rate cuts later in 2025. Treasury yields are little changed, with the 10-year at 4.43% and 30-year above 5%, reflecting elevated fiscal and concerns about today's inflation data. The dollar index (DXY) ticked up 0.25% as investors re-evaluated policy risks and global capital flows. The USD is also rebounding after sharp losses in the previous session / this week.
► Asian equities drop sharply on tariff reinstatement & inflation shock in Japan
Asia-Pacific markets sold off as tariff fears resurfaced. Japan’s Nikkei 225 fell 1.22%, dragged by exporters and tech names, while South Korea’s Kospi lost 0.84% and Hong Kong’s Hang Seng slid 1.2%. China’s CSI 300 declined 0.48%, weighed down by fresh concerns over export disruption and weak domestic spending. Notably, Japan's Tokyo Core CPI accelerated to 3.6%, surprising to the upside and triggering further worries about policy space. Trade-sensitive names like BYD (-5.6%) and SK Hynix (-3.77%) posted steep losses. The market remains on edge ahead of the next round of US-China trade dialogue.
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