US stocks clawed back some of last week's losses amid light catalysts - Newsquawk Asia-Pac Market Open

US stocks managed to claw back some of the prior week's losses with a rebound in Nvidia (NVDA) shares and in semiconductors supportive of the move which resulted in the outperformance of the tech sector. Elsewhere, gold and oil prices were lower following a lack of geopolitical escalation over the weekend which also initially weighed on Treasuries, although T-notes gradually pared the earlier losses and tracked Bunds higher ahead of a plethora of key risk events.
USD was ultimately flat in quiet trade amid a lack of catalysts and with the Fed in a blackout period, while the focus is on this week’s plethora of US corporate earnings, US GDP and US PCE data ahead of the Fed rate decision next week.
Looking ahead, highlights include Australian, Japanese & Indian PMIs, Singapore CPI, Supply from Japan.

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Highlights include Australian, Japanese & Indian PMIs, Singapore CPI, Supply from Japan.
Click here for the Newsquawk Week Ahead.

US TRADE

US stocks managed to claw back some of the prior week's losses with a rebound in Nvidia (NVDA) shares and in semiconductors supportive of the move which resulted in the outperformance of the tech sector. Elsewhere, gold and oil prices were lower following a lack of geopolitical escalation over the weekend which also initially weighed on Treasuries, although T-notes gradually pared the earlier losses and tracked Bunds higher ahead of a plethora of key risk events.
SPX +0.87% at 5,010, NDX +1.02% at 17,211, DJI +0.67% at 38,240, RUT +1.02% at 1,967
Click here for a detailed summary.

DATA RECAP

USD was ultimately flat in quiet trade amid a lack of catalysts and with the Fed in a blackout period, while the focus is on this week’s plethora of US corporate earnings, US GDP and US PCE data ahead of the Fed rate decision next week.
EUR traded flat against the dollar which saw the single currency on both sides of 1.0650 with the latest ECB survey from Reuters showing the vast majority of those surveyed expecting the central bank to cut rates in June, while ECB’s Centeno suggested rate cuts this year could exceed 100bps and that the ECB would still be in restrictive territory even after such cuts.
GBP extended on recent losses and tested the 1.2300 level to the downside where it then rebounded off support.
JPY marginally softened against the dollar in which USD/JPY printed a fresh 34-year peak but fell short of the 155.00 level.
Swiss National Bank is raising the minimum reserve requirement for domestic banks from 2.5% to 4.0% and is amending the National Bank Ordinance as of 1st July 2024 which will not affect the current monetary policy stance.

Treasuries pared most of their overnight losses ahead of key events including supply, GDP, PCE and earnings.

Oil prices were subdued due to a lack of major geopolitical escalation which saw an unwind of the geopolitical risk premium.

MIDDLE EAST

Israeli PM Netanyahu said Hamas rejected all proposals related to the release of the hostages and the determination is firm to free them, according to Sky News Arabia.
Israeli army said they have started a military operation in the corridor separating the northern, central and southern Gaza Strip, according to Al Jazeera.
Israeli media said the Israeli army shot down a suspicious air target that entered Israeli airspace from Lebanon, according to Sky News Arabia.
Hezbollah fired dozens of rockets into northern Israel on Monday which drew retaliatory strikes, while it said its attack was in response to recent Israeli strikes on towns and villages in southern Lebanon, according to Associated Press.
EU Foreign Ministers reached an agreement to expand sanctions on Iranian drones to include missiles and transfer to proxies.
European Commissioner said they are ready to increase support to the Lebanese Armed Forces in order to promote stability, according to Al Arabiya.

OTHER

Poland is said to be "ready" to have nuclear weapons on its territory, according to the President cited by AFP. It was separately reported that Russia's Kremlin said their military will analyse this and take the necessary steps regarding reports that Poland is ready to host US nuclear weapons. However, the Polish Foreign Minister later said that they have not taken any decision on the deployment of nuclear weapons in their territory.
Russian Foreign Minister said the West is teetering dangerously on the brink of a direct military clash between nuclear powers and he sees serious strategic risks that could lead to an increase in the level of nuclear danger.
US President Biden told Ukrainian President Zelensky that US aid will come as the Senate passes the supplemental spending bill and he signs it into law.
North Korea fired a suspected ballistic missile which flew towards the sea off the east coast, while the missile was believed to have fallen outside of Japan's Exclusive Economic Zone.

NOTABLE HEADLINES

Chinese Premier Li stressed that promoting the steady and healthy development of the capital market is an important embodiment of economic development. It was also stated that China will step up the improvement of the basic system of the capital market, improve and strengthen supervision, as well as deepen capital market reforms, according to Chinese state radio.
An earthquake was reportedly been felt in Taiwan's capital of Taipei, according to Reuters citing witnesses, while GFZ reported it as a 6.0 magnitude.

NOTABLE HEADLINES

ECB’s Centeno said total rate cuts this year could exceed 100bps and they will still be in restrictive territory even after easing by 100bps, while he stated that waiting too long to change the policy stance might require more aggressive rate reductions, according to Bloomberg citing Econostream.
ECB's Patsalides said ECB decisions are to hinge on data and there is no set path.
Italy's Economy Minister expects a gradual easing in monetary policy, likely to take place in the second part of this year.

DATA RECAP