Global Market Quick Take: Asia – June 17, 2025

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Key points:

• Macro: Reports of Iran looking to de-escalate tensions
• Equities: S&P 500 gained 0.9%; AMD rises 9% after Piper Sandler upgrade
• FX: USDJPY rose 0.5% to 145 ahead of the BOJ meeting
• Commodities: Gold and oil rose as Trump called for Tehran's evacuation
• Fixed income: Treasuries fell, led by long-dated maturities, steepening the yield curve

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Disclaimer: Past performance does not indicate future performance.

Macro: 

• Trump called for Tehran's evacuation amid Israeli airstrikes, saying Iran should have signed his proposed deal. Iran asked Middle Eastern nations to urge Trump to push Israel for a ceasefire, offering flexibility on nuclear talks.
• New York Empire State Manufacturing Index dropped to -16 in June 2025 from -9.2 in May, below the expected -5.5, signalling worsening business conditions. It marked the weakest reading since March's -20, with declines in new orders, shipments, worsened supply availability, and unchanged delivery times.
• China retail sales gained 6.4% in May, better than the estimated 4.9% while unemployment rate fell to 5% from 5.1% last month.

Equities:

• US - The S&P 500 increased by 0.9%, the Dow added 317 points (0.7%), and the Nasdaq climbed 1.4%, recovering from Friday's sharp losses. Iran's openness to reducing hostilities with Israel and resuming nuclear talks, contingent on US military non-involvement, lifted sentiment. Gains were driven by tech and consumer discretionary stocks like Meta (up 2.9%), Palantir (up 3%), and Tesla (up 1.2%), while energy stocks fell due to a nearly 2% drop in oil prices. US Steel jumped 5.1% following President Trump’s approval of Nippon Steel's $14.1 billion acquisition, and Roku soared 10.4% on news of an advertising partnership with Amazon Ads. AMD rallied 9% after being upgraded by Piper Sandler who expects a “snapback” for the GPU business in the 4th quarter.
• EU - Frankfurt's DAX rose by 0.8% to 23,692 on Monday, ending a six-day losing streak, aligned with regional markets. Improved sentiment followed reports that Iran is willing to end hostilities with Israel and resume nuclear talks with the US. Investors focused on upcoming monetary policy decisions from the Federal Reserve and the Bank of England. Siemens Energy and Sartorius led gains, rising 4.6% and 4.1%, respectively. Other notable advances included Daimler Truck Holding, Deutsche Bank, Heidelberg Materials, Vonovia, MTU Aero Engines, Deutsche Borse, and Commerzbank, each increasing by 2% to 2.5%.
• HK - The Hang Seng rose by 0.7% to 24,061 on Monday, its first gain in three sessions after recovering from earlier losses on the back of easing Middle-east tensions. Property stocks led the rise, driven by Guangzhou's plans to ease home-buying restrictions, alongside strong consumer and financial sectors buoyed by a surge in China's May consumer spending. Hong Kong's exchange is aiming for secondary listings from Southeast Asian and Middle Eastern firms. Guangzhou R&F Properties increased by 3.1% on robust May sales, with Xiaomi Corp (up 4.6%), China Resources Land (up 4.4%), and Kuaishou Tech (up 3.5%) contributing to the gains. Conversely, Wuxi Biologics dropped by 5.2% following a major shareholder's reduction in stake.

Earnings this week:

FX:

• The US dollar rebounded after Israel declared it would continue military actions against Iran, regardless of US negotiations. President Trump, attending the G-7 summit, hinted at possible new trade deals. Focus this week is on central bank meetings, including the Federal Reserve, BOE, SNB and BOJ. Trump sees a Canada trade deal as "achievable." USDCAD fell 0.1% to 1.3574; AUDUSD and NZDUSD rose 0.6% and 0.7%, respectively, outperforming other G10 currencies. 
• USDJPY increased 0.5% to 144.81 ahead of the BOJ meeting, where interest rates are expected to remain unchanged. Governor Kazuo Ueda's press conference scheduled for 3:30 p.m. EURUSD rose 0.1% to 1.1558.

Commodities:

• Oil prices climbed as Trump urged Tehran's evacuation and Israel promised further strikes, raising supply concerns. West Texas Intermediate surpassed $73 per barrel, up 2.7% earlier. Futures closed lower as Iran sought to ease tensions from Israeli attacks.
• Gold rose in Asia as Trump called for Tehran's evacuation, boosting safe-haven demand amid Israel-Iran tensions. Bullion increased 0.4% to over $3,400 an ounce after a 1.4% drop on Monday.

Fixed income:

• Treasuries closed with losses, led by long-dated maturities, steepening the yield curve as yields rose over six basis points despite strong demand at a 20-year bond auction. The 2s10s and 5s30s spreads widened post-auction. Reduced fears of conflict between Israel and Iran supported US stocks, while Treasuries, crude oil, and gold decreased in value. Additionally, Treasuries were pressured by nearly $9 billion in investment-grade corporate bond sales, as borrowers took advantage of improved risk appetite ahead of the Federal Reserve's policy decision.

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