Morning Brew June 2 2025

Good morning,

S&P 500 rose 6.2% in May, while the Nasdaq Composite almost 10%, both indexes delivering the biggest monthly increases since November 2023. The S&P is now only 4% from it`s all time high.

 US 10 Year yields fell to 4.39% on Friday, the USD Index ended the week at 99.43. EURUSD closed at 1.1350, GBPUSD 1.3460 and USDJPY 144. Gold and Silver ended May at 32.97 and 3290, this morning the USD is weaker at 99.13, EURUSD is 1.1380 and Gold and Silver 33.15 and 3323. Japanese 30 Year Yields are back near 3%.

Equity indexes are a little lower with the GER40 at 23940, the US 500 at 5875, Koen explains How to earn extra income from your Nestlé shares - without taking on unnecessary risk

A covered call allows long-term Nestlé shareholders to earn extra income by selling call options on their shares, collecting a premium in exchange for agreeing to sell if the price rises above a set level. This strategy provides limited downside cushion and caps potential gains, making it suitable for investors seeking conservative income with clearly defined risks and outcomes. How to earn extra income from your Nestlé shares - without taking on unnecessary risk | Saxo

We have a lot of headlines to follow:

• Asia's factory activity declined May due to stalling Chinese demand and U.S. tariffs
• U.S. President Donald Trump said on Friday he planned to increase tariffs on imported steel and aluminum to 50% from 25%, ratcheting up pressure on global steel producers and deepening his trade war. While the effective U.S. tariff on imports was 2% to 3% before Trump took office, it stands at about 15%, according to Oxford Research. There is astonishingly little market reaction- this can be related to the “TACO” trade, which implies Trump Always Chickens Out…
• Ukraine dealt a severe blow to Russia`s ego and military with a drone attack deep inside Russia, the attack happened just ahead of renewed ceasefire talks in Istanbul. The attack was dubbed Russia`s Pear Harbor in the media.
• The world’s largest group of oil producers, OPEC+ will increase production by more than 400k barrels per day in July, curiously oil is up at 62.50.
• The Senate will start the passage of the "big, beautiful" tax bill.
• Pete Hagseth warns of imminent China threat, pushes Asian allies to hike defense spending
• German Chancellor Friedrich Merz will be in the US on Thursday to meet Donald Trump
• Polish nationalist opposition candidate Karol Nawrocki won presidential election with 50.89% 
• Elon Musk has ended his active role in the US Administration-
• Key drivers of the week are the ongoing tariff discussions, the US Nonfarm Payroll, the ECB and the Bank of Canada rate decisions.
• The ECB is expected to cut rates by 25 basis points with a percentage above 90% and is seen to deliver one more cut this year. The Bank of Canada is seen to take no action with 75% probability and the 25% are in favor of a cut. By year end the rate is seen 0.4% below the current level.

Trade safely!!

Monday, June 2

- Switzerland: Q1 GDP

- Global: S&P Global PMIs

Tuesday, June 3

- Eurozone: Flash CPI Inflation

- Germany: Trade Balance

- US: Factory Orders (April)

- Jolts Job Openings

Wednesday, June 4

- Eurozone: Unemployment Rate (April)

- Germany: Industrial Orders (April)

- Global PMI

- Canada: Bank of Canada Rate Decision

Thursday, June 5

- Eurozone: ECB Interest Rate Decision (expected 25bp cut) & Inflation

- Germany: Industrial Production (April)

- US: Weekly Jobless Claims

- US Trade Balance

- Canada: Trade Balance (April)

Friday, June 6

- DE Trade

- UK Houseprices

- EU GDP

- US: Non-Farm Payrolls (May), Unemployment Rate, Average Hourly Earnings (May)

- Canada: Employment Report (May)