Asia Market Quick Take – 02 June, 2026

Asia Market Quick Take – 2 June, 2026

Key points:

• Macro: Iran halts talks with US after Israeli strikes in Lebanon
• Equities:S&P 500 gained 0.3% to new highs as Nvidia(+6.3%) announces new CPU chip
• FX:USD firms; USDJPY nears 160 despite record Japanese FX intervention efforts
• Commodities: Copper rallied above $6.50 while WTI rose above $90
• Fixed income: 30-year yield down in 7 of the past 8 sessions, below 5%

Disclaimer: Past performance does not indicate future performance.  

 Macro: 

• Iran halted contacts with Washington after Israeli strikes in Lebanon and is weighing with allies closing the Strait of Hormuz and Bab el-Mandeb. Trump says talks continue and a deal on Hormuz could come within a week. Lebanon wants any extended Hezbollah–Israel ceasefire to cover all its territory.
• US ISM Manufacturing beat expectations in May, but prices paid stayed above 80 for a second month, the first time since the post-Covid period, underscoring sticky inflation.
• Canada’s manufacturing PMI held in growth at 52.9 in May, just below April’s 53.3. Output, new orders, and employment rose on stronger demand, but input and output prices neared four-year highs, supply chains were hit by Middle East disruptions, and business confidence stayed subdued.
• US construction spending rose 0.4% m/m in April 2026, its second straight increase and above expectations, lifting the y/y gain to 0.9%. Private and public spending both rose 0.4%, with single-family housing up 1.4% while multi-family and private nonresidential dipped.
• Germany’s manufacturing PMI was revised up to 50.1 in May 2026 from 49.9, signaling near-stagnation and a four-month low, as new orders fell, prices saw their biggest rise since June 2022, output growth slowed, job cuts deepened, and business expectations stayed muted but slightly improved from April.
• Switzerland’s GDP grew 0.4% q/q in Q1 2026, below the 0.5% estimate. Industrial output rose on stronger manufacturing, but chemicals and pharma slumped, pulling goods exports down. Services growth was modest, with gains in transport and finance offset by weaker trade, retail, and tourism. Domestic demand was flat, as higher government spending was offset by lower investment, and imports fell on soft demand.
• Germany’s retail sales fell 0.3% m/m in April 2026, their fourth straight decline but slightly better than forecasts. Non-food and online sales dropped sharply, while food sales rose 3.2%. On the year, sales were down 0.2%, pointing to weak consumer demand despite easing inflation.

Equities:  

• US — S&P 500 rose 0.3% to a record 7,599.96 on Monday, its eighth consecutive gain and longest winning streak since May 2025. Nasdaq 100 gained 0.6% and the Nasdaq Composite rose 0.4% to 27,086.81, its 19th record close of 2026. Nvidia surged 6.3%, leading the index, after unveiling a new superchip described as the most efficient PC chip ever built. MGM Resorts was the single largest gainer, up 16.1%. Anthropic's confidential IPO filing also boosted AI sentiment, valuing the company at $965b. Salesforce rose 9.6% after revealing a stake in Anthropic worth about $5b. In after-hours trade, HPE soared after guiding for FY26 revenue growth of 29–33%, well above consensus, citing surging AI server demand. Credo Technology fell approximately 12% after hours on disappointing results.
• EU — European equities declined on Monday, weighed by Iran war uncertainty and a lack of AI-linked exposure. The Stoxx 600 fell 0.8%, its biggest drop since 15 May, with healthcare leading losses. The FTSE 100 dropped 0.7% to 10,338.95, its lowest close since 19 May, with AstraZeneca down 2.7% and Persimmon falling 5.4%. The DAX fell 0.4% to 25,003.04, with Rheinmetall the largest decliner at -6.7%. The Euro Stoxx 50 closed 0.26% lower at 6,034.95, down for a third consecutive session. EasyJet was a notable outperformer, jumping as much as 13% to a three-month high.
• Asia — The MSCI Asia Pacific Index fell 0.9% after closing at an all-time high on Monday. The Nikkei opened 0.5% lower at 66,629, dragged by auto and chemical stocks — Toyota is down 2.9% and Shin-Etsu Chemical fell 4.1%. The Kospi opened 1.1% higher but reversed sharply to trade around 0.3% lower. S&P 500 futures are down 0.2% and Nasdaq 100 futures are off 0.4%. On Monday, the Hang Seng rose 0.9% to 25,398, led by Meituan (+6.5%) after the company reported a Q1 adjusted net loss of 4.97 billion yuan, narrower than the 6.83 billion yuan estimate. Mainland investors bought a net HK$4.66 billion via Stock Connect. NIO and XPeng ADRs each gained 5.4% in New York after May deliveries rose month-on-month. Daikin fell as much as 5% after being cut to Hold at Jefferies.

Earnings this week:

• Tuesday: Palo Alto Networks, Dollar General, Ulta Beauty, GEK Terna, GitLab
• Wednesday: Broadcom, Inditex, CrowdStrike, Medtronic, Veeva Systems
• Thursday: Ciena, Samsara, Planet Labs, Lululemon, Rubrik
•  Friday: Sectra, Mr Price Group, ABM Industries, Foschini Group

FX: 

• USD strengthened with the Bloomberg Dollar Spot Index edged up 0.25% on Monday, snapping a two-day decline, as Iran peace deal uncertainty revived safe-haven demand for the greenback. 
• USDJPY rose to 159.67, approaching the psychologically significant 160 level. Japan spent a record $73.6 billion intervening to prop up the yen over the past month, but the currency has nearly retraced the full move. Markets are watching closely for renewed intervention. 
• EURUSD slipped 0.1% to 1.1647, though the euro is expected to find support as the ECB is widely anticipated to hike rates at its June meeting, narrowing the policy gap with the US.
• GBPUSD at 1.3460 was the only G10 gainer Monday, extending a three-day advance. With few domestic drivers, sterling is seen largely driven by Friday’s US nonfarm payrolls.
• AUDUSD fell to 0.7160 as Lebanon-related tensions boosted the USD. RBA Board member Ian Harper spoke, but with limited market impact. NZDUSD sits near 0.5930, testing a key downtrend from the February 2021 high; a June close above could signal further gains.

Commodities: 

• Gold fell 1.9% to settle at $4,475.20 per troy ounce, pressured by persistent inflation and elevated rate expectations that limit the appeal of the metal as a safe haven, even as geopolitical uncertainty from the Iran conflict provides a partial floor.
•  Comex copper surged 2.59% to $6.524 per pound on Monday, its third-highest close in history, as traders position ahead of the US Commerce Department's June 30 deadline to deliver an updated recommendation on import tariffs for refined copper. Citi sees copper potentially reaching $14,500 per tonne in June.
•  US crude oil rallied toward $92 per barrel amid stalled Iran ceasefire talks before paring some gains after Trump's comments on Israel-Hezbollah. Elevated oil prices continue to feed through into broader inflation expectations and are a key variable for global bond markets.

Fixed income:  

• The US Treasury yield curve shifted higher in a bear-flattening move, with the 2-year yield rising 3.8 basis points to 4.051% and the 10-year yield up 3.6 basis points to 4.475%, snapping a five-day streak of falling yields. The move was driven by the stronger-than-expected ISM Manufacturing print and elevated prices paid data.
• The 30-year Treasury yield edged down slightly to 4.990%, continuing its recent trend of outperforming the front end. The 30-year has fallen in seven of the past eight sessions and remains well off its 52-week high of 5.180% hit on 19 May.
• PIMCO argued that the recent rise in long-dated Treasury yields is driven primarily by shifting Fed rate path expectations rather than AI-related debt issuance or term premium, pushing back on a widely cited narrative. US junk bond spreads dropped to a four-month low, with high-yield credit continuing to be supported by solid fundamentals and softer inflation data.

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