From Nasdaq: 2025-06-02 15:20:00

Stock indexes saw mixed movements today, with the S&P 500 up +0.34%, the Dow Jones down -0.02%, and the Nasdaq up +0.63%. Trade tensions between the US and China escalated, with China accusing the US of introducing discriminatory restrictions on AI chips and student visas. President Trump aims to discuss trade truce with Chinese President Xi Jinping.

The 10-year T-note yield rose +5 bp to 4.46% amid escalating US-China trade tensions, leading to a selloff in dollar assets. WTI crude prices surged over 3%, boosting inflation expectations. US manufacturing activity contracted unexpectedly, influencing Fed policy views. Stock indexes rebounded due to energy gains and steel/aluminum tariff news.

US manufacturing activity and construction spending fell unexpectedly last month. Fed Governor Waller’s comments hinted at potential rate cuts later this year. Markets are pricing in a 5% chance of a -25 bp rate cut at the upcoming FOMC meeting. The focus this week is on trade news and key economic reports, including job data and Fed Chair Powell’s remarks.

Overseas markets declined, with Euro Stoxx 50 and Japan’s Nikkei Stock 225 down. Interest rates were mixed, with T-notes under pressure from escalating trade tensions and rising inflation expectations. European government bond yields moved higher, while swaps indicate a high probability of a rate cut by the ECB on Thursday.

US stock movers included Adobe, CDW Corp, and Science Applications International down over 3%. Tesla fell after a drop in new-vehicle registrations in France, while Centene declined due to a downgrade. Steel and aluminum producers surged on Trump’s tariff hike announcement, with Nucor leading gainers. Energy and chip stocks also saw gains.

Moderna rose over 1% after FDA approval for its Covid vaccine, while Vera Therapeutics surged over 57% on positive trial results. Earnings reports for June 2 included Credo Technology, Science Applications International, and The Campbell’s Company. The author disclosed no positions in mentioned securities. The opinions expressed are solely for informational purposes.



Read more at Nasdaq: Stocks Rebound Despite escalating U.S.-China Trade Tensions