US EQUITY OPEN: Stocks marginally lower as we await a read out of the Trump/Xi call

Stocks have been sold since the open with downside led by the Russell. Outperformance is seen in Communication Services, the only sector in the green. Underperformance is seen in Consumer Staples, Consumer Discretionary and Financials. The key updates have been from both Chinese and US media suggesting that US President Trump and China President Xi held a call. We are now on the lookout for a potential readout of the call between the two leaders. Meanwhile, US data was mixed. Initial Jobless Claims rose further, Continued Claims eased but remained above 1.9mln, while the International Trade data confirmed the plummet in imports seen in the advance report, which has positive implications for GDP. Meanwhile, the Unit Labour Costs saw a chunky rise while Productivity saw a notable decline, which has a stagflation implication. Meanwhile, Challenger Layoffs of 93.8k were not as large as the 105k in April. Attention turns to the May NFP report and its implications for Fed policy, given the FOMC are in wait and see mode. Elsewhere, the ECB cut rates by 25bps as expected and President Lagarde said policy is now in a good position, and they are now getting towards the end of the monetary policy cycle, resulting in upside in the Euro. In FX,  Antipodes and the Euro are outperforming, with the AUD and NZD likely benefitting from the Trump/Xi call. The Dollar and Yen are lagging. Crude prices are firmer and currently around session highs on the weaker dollar and still benefitting from the Trump/Xi news. Looking ahead, focus will be on the readout of the Trump/Xi call, as well as remarks from US President Trump when he meets with German Chancellor Merz. Fed's Kashkari, Harker and Schmid are also set to speak, with earnings from Broadcom (AVGO) in focus after-hours. 

STOCK SPECIFICS

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  MongoDB (MDB): EPS, revenue beat and raised share buyback programme by USD 800mln; Solid next quarter and raised FY outlook.


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  Verint Systems (VRNT): Top and bottom-line beat.


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  PVH Corp (PVH): Lowered next quarter profit view and cut FY outlook.


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  Procter & Gamble (PG): To cut 7k jobs & expects non-core charge of USD 1.0-1.6bln


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  Apple (AAPL): Lost a US appeals court bid to pause a judge’s order requiring it to allow more App Store competition.


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  Citi (C ): Will cut 3,500 tech jobs in China by Q4


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  Nvidia (NVDA): Director Mark Stevens has sold over 1mln shares this week. In other news, Nvidia’s biggest Chinese rival Huawei struggles to win at home, according to The Information; Big Chinese tech firms have not yet made big orders for Huawei chips and tests showing Huawei chips overheat.


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  Brown Forman (BF.B): Missed on top and bottom line alongside downbeat commentary.

05 Jun 2025 - 14:58- ForexData- Source: Newsquawk