Morning Note: Market News
Market News
Middle East Conflict: Donald Trump met with his national security team for more than an hour to discuss the Mideast conflict, people familiar said, fuelling speculation the US may join Israel’s attack on Iran. He then spoke with Benjamin Netanyahu. Israel and Iran each indicated they plan to ratchet up the conflict. Tehran has prepared missiles to strike regional US bases should Washington join the war, the NYT reported. The US embassy in Jerusalem will remain closed for the next three days, the State Department said.
Markets: US markets were weaker on Tuesday with the S&P 500 closing 5982.72 -50.39 (-0.84%). US futures got a small boost after people familiar said regulators plan to reduce a key capital buffer for big lenders. European contracts were mixed. Oil traded near a five-month high.
US Rates: The Fed is expected to stand pat and leave rates unchanged later today. While Jerome Powell may try to avoid sounding hawkish, the dot plot may signal just one more 25-bp cut this year, Bloomberg Economics said.
UK inflation slowed by less than expected to 3.4% in May versus expectations of 3.3%. The pound held gains. Sweden’s central bank will probably cut its key rate to 2% from 2.25%.
Australian Prime Minister, Anthony Albanese spoke with Ursula von der Leyen and Antonio Costa at the G-7 and hopes to conclude a security partnership “pretty quickly.” The Australian PM also championed expanding trade ties.
Corporate: HSBC may order all employees back to the office at least three days a week, the FT reported. KKR and GIC are said to be among final bidders for a stake in a broadband venture owned by MasOrange and Zegona. Sam Altman said Meta is offering signing bonuses of up to $100 million to hire OpenAI employees. Elon Musk’s xAI is burning through $1 billion a month, people familiar said.
More US: The US Senate passed a Trump-backed stablecoin bill in a major win for the crypto industry. The US Supreme Court was asked to consider striking down many of Trump’s tariffs. Two family-owned toy companies requested an expedited track, with a decision possible by the end of the year. The Republicans’ tax and spending bill would add $2.8 trillion to US deficits over the next decade, according to the CBO.
US crude inventories fell by a massive 10.1 million barrels last week, the API is said to have reported. That would be the biggest decline in almost a year if confirmed by the EIA today. Supplies at Cushing edged lower.
