Global Markets Report - 4 June
ASX set to open lower after a mixed session on Wall Street.
Australia
Australian shares are set to open lower, after a mixed session on Wall Street.
ASX futures were down 0.2% or 12 points as of 8:00am on Tuesday, suggesting a lower open.
U.S. stocks ended mixed, recovering from steep early losses, as Nvidia again lifted the technology sector, while the blue chip index underperfomed.
The DJIA fell 115 points, or 0.3%, to 38,571, while the S&P 500 gained 0.1% to 5,283 and the Nasdaq rose 0.6% to 16,828.
In commodity markets, Brent crude oil was down 3.6% to US$78.20 a barrel, while gold was up 1.0% at US$2,350.75.
In local bond markets, the yield on Australian 2 Year government bonds was down at 4.09% while the 10 Year yield was also down at 4.37%. US Treasury notes were down, with the 2 Year yield at 4.81% and the 10 Year yield at 4.39%.
The Australian dollar was 66.85 US cents, down from its previous close of 66.87. The Wall Street Journal Dollar Index, which tracks the US dollar against 16 other currencies, was down at 99.03.
Asia
Chinese shares ended mostly lower as investors digested PMI data. The benchmark Shanghai Composite Index was down 0.3% at 3078.49, the Shenzhen Composite Index was 0.6% lower, while the ChiNext Price Index gained 0.8%. The Caixin Manufacturing PMI data released this morning, which indicated factory activity expanded in May, was in contrast with the official gauge's indication that the sector was contracting. Among major stocks, Ping An Bank was 1.2% lower and East Money Information declined 0.9%. Gainers include BYD, which added 3.5%, and CATL, which was 2.4% higher.
Hong Kong's Hang Seng Index closed 1.8% higher at 18,403.04, led by EV stocks. China's Caixin manufacturing PMI rose in May to its highest level since June 2022, signaling faster manufacturing growth, in contrast with the official index's unexpected slide into contraction. EV stocks led the gains, with Li Auto rising 5.3%, BYD jumping 5.0% and Geely Automobile climbing 3.5% after the automakers reported a rise in sales for May. Among decliners, Wharf REIC lost 2.0%, Sino Biopharmaceutical shed 1.8% and Sun Hung Kai Properties was 1.1% lower.
Japanese stocks ended higher, led by gains in financial and electronics stocks, as concerns eased about U.S. inflation and borrowing costs. Nomura Holdings gained 4.0% and Yaskawa Electric climbed 4.7%. The Nikkei Stock Average rose 1.1% to 38923.03. The 10-year Japanese government bond yield fell 1 basis point to 1.060%. Investors are focusing on economic data and their policy implications.
India shares closed at a record high after exit polls projected a third term for Prime Minister Narendra Modi. "The optimism in the Indian economy is evident as markets surged after exit poll results and in anticipation of election outcomes," said Puneet Maheshwari, director at Upstox. Investors are waiting for the elections results due on Tuesday. Almost all sectors rose, with State Bank of India up 9.1%. Reliance Industries, one of India's biggest conglomerates, jumped to an all-time high of INR3,029.90 before closing 5.65% higher. Power Grid Corp. of India rose 9.0% and Larsen & Toubro advanced 6.3%. Among the few decliners, HCL Technologies was down 0.6% and Sun Pharmaceutical Industries dropped 0.5%. The benchmark Sensex closed 3.4% higher at 76468.78, its largest one-day gain since February 2021.
Europe
Stocks in the U.K. slipped Monday, as the FTSE 100 Index declined 0.1% to 8266.84.
Among large companies, GSK PLC posted the largest decline, dropping 9.5%, followed by shares of YouGov PLC, which dropped 7.7%. Shares of Baltic Classifieds Group PLC dropped 5.5%.
Pets at Home Group PLC was the biggest gainer during the session, surging 8.9%, and Zegona Communications PLC surged 8.7%. JD Sports Fashion PLC rounded out the top three movers on Monday, as shares surged 5.1%.
In Europe, shares closed higher, with the STOXX Europe 600 Index adding 0.3% to 519.85, Germany's DAX up 0.6% at 18,608.16 and France's CAC 40 gaining just under 0.1% to 7,998.02.
North America
U.S. stocks ended mixed, recovering from steep early losses, as Nvidia again lifted the technology sector, while the blue chip index underperfomed.
The DJIA fell 115 points, or 0.3%, to 38,571, while the S&P 500 gained 0.1% to 5,283 and the Nasdaq rose 0.6% to 16,828.
Economic data hinted at a slowing U.S. economy, sending Treasury yields lower. The ISM's manufacturing index contracts more sharply in May than economists had forecast, as traders anticipate Friday's jobs numbers.
Energy was the worst performing sector, driven by oil's 3.6% decline following an OPEC+ meeting over the weekend.
GameStop shares jumped 21% after a Reddit account linked to meme-stock folk hero Keith Gill posted a screenshot showing a $116 million position in the stock.