Global Market Quick Take: Asia – June 18, 2025

Global Market Quick Take: Asia – June 18 , 2025

Note: This is marketing material.

Key points:

• Macro: US retail sales fall 0.9% against 0.7% expected
• Equities: Equities fall due to rising Middle East tensions
• FX: USD bid as US could get involved in Israel Iran conflict
• Commodities: Oil surges more than 4% above $75
• Fixed income: Yields fall due to tensions and upcoming Fed decision

------------------------------------------------------------------

Disclaimer: Past performance does not indicate future performance.

Macro: 

• US retail sales fell 0.9% in May 2025, the largest drop in four months, following a revised 0.1% decline in April and exceeding the forecasted 0.7% fall. Consumers pulled back ahead of expected tariffs, with motor vehicle & parts dealers seeing the biggest decline.
• NAHB/Wells Fargo Housing Market Index fell two points to 32 in June 2025, the lowest since December 2022, missing expectations of a rebound to 36. This reflects high interest rates and pessimistic consumer demand amid tariffs and uncertain economic conditions raising mortgage costs.
• US industrial production fell 0.2% in May 2025, missing expectations of a 0.1% rise, after a 0.1% increase in April. Manufacturing output rose 0.1%, below the forecasted 0.2%.
• US import prices remained unchanged in May 2025, defying expectations of a 0.2% drop, following a 0.1% rise in April. Non-fuel import prices rose 0.3%, extending a 0.4% increase, the sharpest in a year, as foreign firms maintained prices despite aggressive tariffs.

Equities:

• US - Equities fell on Tuesday amid escalating Israel-Iran tensions. The S&P 500 dropped 0.8%, the Dow lost 299 points, and the Nasdaq fell 0.9%, with fears of US involvement. Trump demanded Iran's "unconditional surrender" and threatened Supreme Leader Khamenei on Truth Social. US retail sales fell 0.9% in May, indicating tariff impacts. JetBlue plunged 7.9% due to weak travel demand, while United, Delta, and American Airlines fell 6.2%, 4.3%, and 3.1%. ExxonMobil and Chevron rose 1.3% and 3.2%.
• Hong Kong – HSI fell 0.3% on Tuesday, reversing gains amid broad losses. Sentiment weakened as U.S. futures fell after Trump's G7 exit and Israel-Iran tensions. Investors were cautious before the Fed meeting. China's May yuan loans were below expectations. Ping An and HSBC fell 0.7%, Hang Seng Bank 0.4%, and consumer, tech, and property stocks declined. Chow Tai Fook dropped 7.3% on plans to raise USD 1 billion via convertible bonds.

Earnings this week:

FX:

• USD strengthened as safe haven demand increased amid rising expectations of US involvement in the Israel-Iran conflict. Most G10 currencies reversed gains, with EURUSD dropping below 1.15, USDJPY rising above 145, and AUDUSD falling below 0.65.

Commodities:

• WTI crude oil futures surged 4.3% to $74.8 per barrel as escalating US-Iran tensions reignited supply concerns. Trump demanded Iran's "unconditional surrender" and threatened Supreme Leader Ayatollah Ali Khamenei on social media. Gold climbed above $3,390 per ounce, extending gains due to increased demand for safe-haven assets and Silver prices rose above $37 per ounce, nearing their highest levels since 2012, driven by strong industrial demand, supply shortages, and heightened safe-haven appeal amid geopolitical uncertainty.

Fixed income:

• US 10-year Treasury note fell to 4.4% on Tuesday amid Israel-Iran tensions, economic data, and the Fed's upcoming decision. May retail sales dropped 0.9%, while the GDP-linked control group rose 0.4%. Industrial output fell 0.2%. The Fed is expected to keep rates steady, with focus on projections and future rate signals.

For a global look at markets – go to Inspiration.