This week's key agenda overview
A "civil war" over U.S. tariffs is unfolding! Both sides will submit materials for a decision next week.
The U.S. Federal Circuit Court of Appeals in Washington temporarily reinstated Trump's tariffs on May 29 (Thursday). The appellate court stated that it would pause the lower court's ruling to review the government's appeal, ordering the plaintiffs in the case (the trade court) to respond by June 5 and the government to reply to the plaintiffs' response by June 9.
The day before, a three-judge panel of the U.S. Trade Court ruled that the Constitution grants Congress, not the President, the authority to impose taxes and tariffs, stating that the President overstepped his authority under the International Emergency Economic Powers Act, which is intended to address threats during a national emergency, and ordered an immediate halt to the tariffs.
In a statement shared on social media, Trump expressed his hope that the U.S. Supreme Court would "overturn the dreadful ruling of the trade court that threatens the nation," while criticizing the government's justice department as anti-American.
U.S. non-farm employment in May is expected to slow, potentially raising expectations for a rate cut in June.
On June 6 (Friday), the U.S. will release the non-farm payroll report for May. Swap market data shows that the probability of the Federal Reserve remaining "on hold" in June is currently as high as 98%. Economists generally expect that non-farm employment in May will decrease from last month’s 0.177 million jobs to 0.13 million, with the unemployment rate steady at 4.2%, indicating a mild slowdown in the job market.
Due to unexpectedly strong employment data last month, Wall Street expects the timing of the rate cut to be pushed back from June to July. As the last employment data before the Federal Reserve’s June meeting, if May's non-farm payrolls slow as expected, it may reignite market expectations for a rate cut in June.
Analysts generally believe that although the new non-farm employment in April remains resilient, the cloud of tariffs may gradually weigh on employment, and leading indicators also suggest that the U.S. employment may weaken subsequently. The May non-farm data could truly reveal the running status of the U.S. labor market in a rapidly changing trade environment. If there is a significant decline in May's non-farm employment data, the probability of the Federal Reserve lowering interest rates this year may substantially increase.
The Federal Reserve's economic Beige Book is about to be released, and Federal Reserve governors will successively make statements.
Federal Reserve Chairman Powell, Waller, Lisa Cook, Dallas Fed President Logan, Chicago Fed President Goolsbee, Atlanta Fed President Bostic, and Philadelphia Fed President Harker will successively deliver public speeches to release the latest monetary policy signals. In addition, the Federal Reserve will also publish the national economic situation survey report 'Beige Book' compiled by 12 local Federal Reserves.
At the monetary policy meeting in early May, Federal Reserve policymakers generally believe that the uncertainties facing the economy are higher than before, and it is prudent to remain cautious regarding interest rate cuts, awaiting a clearer impact of the Trump administration's tariffs and other policies before considering action. With the tariff policy continuing to be filled with uncertainty, the word 'uncertainty' is expected to occupy a significant portion of the Beige Book.
Is the ECB's interest rate cut in June a certainty?
On June 5 (Thursday), the European Central Bank announced the latest interest rate decision. Currently, the market generally expects that the ECB will continue to cut interest rates in June, with investors focusing on the wording regarding the subsequent interest rate path in the meeting. Considering the tariff threats dragging down the Eurozone's economic growth prospects and increasing medium to long-term inflation pressures, the difficulty of the ECB's monetary policy decisions is also increasing.
Analyst Stephen Innes stated that ECB President Lagarde and her team chose to cut interest rates not because the economy has collapsed, but due to concerns over increasing uncertainties regarding the outlook. This rate cut is already a certainty, but what the market has yet to fully digest is the subsequent rate-cut path and endpoint. A strategist at UBS stated in a report that given the overall weakening of the dollar, the euro should remain strong, even if the ECB cuts by 25 basis points, the euro will not react much.
The meeting between the leaders of Germany and the U.S. is approaching, with Russia-Ukraine, the Middle East, and trade becoming the focal points.
On May 31, a spokesperson for the German government announced that German Chancellor Merz will visit Washington on June 5 (Thursday) to meet with U.S. President Trump. They will discuss key issues such as the Russia-Ukraine war, the situation in the Middle East, and trade policy. The outcome of this meeting will directly influence the global trade landscape and investor confidence. The escalation of the trade dispute between Germany and the U.S. may impact European exporters, particularly in the Autos and machinery manufacturing sectors, while also affecting American Technology companies' business layout in Europe.
For investors, the results of the meeting on June 5 will become an important barometer for determining the direction of transatlantic relations. If both sides can reach some understanding regarding defense spending and trade balance, it may provide a slight relief in the tense global trade environment. Conversely, if differences become public, it may further exacerbate market concerns over the escalation of the trade war.
Key earnings calendar for the new week.
【Related Reading】Broadcom's Earnings Reports are coming in hot! Weekly Earnings Reports Quick Dispatch (6.2-6.6)
June 2, Monday
Keywords: U.S. ISM Manufacturing PMI, Federal Reserve Governor's Speech, SSE SH Equities Index Closure
On Monday, economic data will include the final value of the U.S. S&P Global Manufacturing PMI, U.S. ISM Manufacturing PMI, and the monthly rate of U.S. construction spending.
Regarding financial events, Federal Reserve Governor Waller will speak on economic prospects at the 2025 South Korea Central Bank International Conference.
In addition, the Hong Kong Stock Connect, SSE SH Equities Index, and Shenzhen Stock Connect will be closed all day due to the Dragon Boat Festival.
June 3, Tuesday.
Keywords: China's Caixin Manufacturing PMI, US factory order month-on-month rate, Powell's speech.
On Tuesday, regarding economic data, investors may pay attention to China's Caixin Manufacturing PMI, US factory order month-on-month rate, and US JOLTs job openings.
In terms of financial events, Federal Reserve Chairman Powell will deliver an opening speech at an event, and Bank of Japan Governor Ueda Kazuo will also speak.
In terms of Earnings Reports, $NIO Inc (NIO.US)$ Performance will be released before the market opens, and a performance live stream will start on the same day at 20:00 Beijing time.
June 4, Wednesday
Keywords: US ADP employment figures, US ISM non-manufacturing PMI, Bank of Canada rate decision announcement, Broadcom Earnings Reports
On Wednesday, economic data will be released, including the US ADP employment figures, US S&P Global services PMI final, and US ISM non-manufacturing PMI.
In terms of financial events, the 2025 FOMC voting member and Chicago Fed Chairman Goolsbee will participate in a Q&A session; subsequently, the 2027 FOMC voting member, Atlanta Fed Chairman Bostic, and Fed Governor Lisa Cook will attend the "Federal Reserve Listening" event; at 21:45 Beijing time, the Bank of Canada will announce its rate decision.
In terms of Earnings Reports, $Broadcom (AVGO.US)$ Performance will be released after the market closes.
June 5th, Thursday.
Keywords: China's Caixin Services PMI, the number of initial unemployment claims in the United States for the week, US April trade balance, the Federal Reserve will publish the Beige Book on economic conditions.
On Thursday, economic data including China's Caixin Services PMI, the number of initial unemployment claims in the United States for the week, and the US April trade balance will be released.
In terms of financial events, at 2 AM, the Federal Reserve will publish the Beige Book on economic conditions; European Central Bank President Lagarde will hold a monetary policy press conference.
Regarding new stocks,$NEWTREND GROUP (02573.HK)$、$RONGTA TECH (09881.HK)$The subscription will end; $Circle Internet Corp. (CRCL.US)$ It will be listed.
June 6, Friday
Keywords: U.S. May unemployment rate, May seasonally adjusted non-farm employment population
On Friday, in terms of economic data, the U.S. May unemployment rate and May seasonally adjusted non-farm employment population will be announced.
In terms of financial events, Federal Reserve Governor Cook will give a speech at the New York Economic Club, and 2026 FOMC voting member, Philadelphia Fed President Harker will speak on the economic outlook.
Regarding new stocks, $Omada Health (OMDA.US)$ It will be listed.
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In the new week, wishing mooers a successful investment!
Editor/joryn
