6 June 2025
US stocks fell on Thursday ahead of nonfarm payrolls data. The S&P 500 ended 0.5% lower.
US Treasuries fell and the yield curve flattened as intraday gains spurred by higher-than-expected jobless claims were over-shadowed by weakness in European bonds. 10-year yields ended 3bp higher at 4.39%.
European stock markets were mixed on Thursday, as markets digested the ECB’s latest 25bp rate cut. The Euro Stoxx 50 ended 0.1% higher. The French CAC fell 0.2% while the German DAX rose 0.2%. The UK FTSE-100 edged 0.1% higher
European government bonds fell amid reduced market expectations for future ECB rate cuts. 10-year German and French bond yields both rose 5bp to 2.58% and 3.25% respectively. In the UK, 10-year gilt yields edged up 1bp to 4.62%.
Asia stock markets traded mostly higher on Thursday. Korea’s Kospi extended its post-election rally (+1.5%), as India’s Sensex ended 0.5% higher, aided by market expectations that the central bank would deliver another 25bp rate cut at today’s meeting. Elsewhere, Hong Kong’s Hang Seng advanced 1.1%, led by tech share gains, as China’s Shanghai Composite rose 0.2%. Japan’s Nikkei bucked the regional trend, ending 0.5% lower.
Crude oil prices rose on Thursday, as investor optimism over US-China trade talks outweighed concerns about increased OPEC+ output. WTI crude for July delivery settled 0.8% higher at USD63.4 a barrel.
The European Central Bank (ECB) cut the deposit rate by 25bp to 2.00%, in line with market expectations. ECB President Lagarde noted that it is getting close to the end of the easing cycle.
In the US, the change in non-farm payrolls should moderate to 130k in May, from 177k in April.
The Reserve Bank of India (RBI) is expected to cut its policy repo rate by 25bp to 5.75% amid benign inflation.
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