Market News

The European Parliament committee just voted in favour of the legislation to remove duties on many US goods and imports, essentially steering clear of another clash with the US on trade - such as the one last year.

As a reminder, US president Trump set a deadline of 4 July for the EU to sort this out or risk incurring a further butting of heads on trade/tariffs once again.

With the passing of the vote here, we are at least seeing the EU avoid another trade conflict with the US. And that's good news especially at a time when the fallout from the Middle East conflict is set to dampen the economy significantly in the coming months.

Just a note though that the legislation above still needs to be approved by the full EU assembly. That is expected…

US Stocks Edge Higher in Uncertain Markets – Nasdaq up 0.4%

US equity markets edged higher overnight, with all three major indices once again reaching fresh record highs as investors continued to assess developments in the Middle East. The Dow Jones rose 0.09% to close at 51,078, while the S&P 500 gained 0.26% to finish at 7,599, and the Nasdaq outperformed with a 0.42% advance to 27,086.

Market sentiment was supported by reports that Israel and Hezbollah are preparing to enter into a ceasefire agreement, a development that could potentially pave the way for an extension of the current US-Iran ceasefire arrangement. While equity investors welcomed the news, other asset classes appeared more cautious about the outlook for regional…

IC Markets Global – Asia Fundamental Forecast | 02 June 2026

What happened in the U.S. session?

Oil prices surged approximately 3% to around $90/barrel after Iran’s chief negotiator said there would be no deal with the U.S., reigniting Middle East supply concerns and overshadowing the previous week’s U.S.-Iran ceasefire optimism. Gold futures slipped 2.5% to $4,485/ounce, and Bitcoin dropped over 2% to $71,400 (down from overnight highs above $74,000) as risk-off sentiment dominated crypto and safe-haven metals.

What does it mean for the Asia Session?

Japan’s Nikkei 225 surging past 67,000 (driven by SoftBank overtaking Toyota as Japan’s most valuable firm on AI enthusiasm), China’s new overseas investment rules tightening scrutiny on…

The Bank of Japan's latest Summary of Opinions from meetings with market participants revealed differing views on the future pace of Japanese government bond (JGB) purchase reductions, highlighting the difficult balancing act the BoJ faces as bond yields continue to climb.

Several participants argued that the need for additional tapering remains limited. One participant stated that the current pace of bond purchases, approximately ¥2.1 trillion per month, should be maintained, while another emphasized that the BoJ should continue purchasing a meaningful amount of JGBs to ensure sufficient liquidity is supplied to the economy as it expands.

Others advocated for a more gradual reduction path. One participant suggested reducing purchases by…

The report cites a source familiar with the situation, in saying that Iran's final text of the deal is still being discussed in Tehran at this juncture. Adding that there is no response yet that is sent to the US on that.

There has been so much back and forth on the text/terms of the deal that it is easy to lose track of what is happening. However, the bottom line is that there is still some differences that require sorting out. And that has been the case for well over two weeks already.

A reminder on what needs to be agreed between the two sides so that the deal can be signed off:

And even then, all this does is to allow for nuclear discussions to take place next. In that lieu, the US is also demanding that Iran provide some baseline…

The main talk of the town yesterday was US president Trump looking to broker a ceasefire between Israel and Lebanon. He confirmed that by saying that "all shooting will stop", allowing for the US to at least try and negotiate with Iran again on a broader framework agreement.

As mentioned before, the Israel-Hezbollah ceasefire is a key precondition that Iran wants as part of the terms for the memorandum of understanding. However, the key question here is whether Israel will abide by that ceasefire. And as we have seen from a few hours ago here, it may not really be the case.

If it cannot last a day, how is it expected to carry through for the next 60 days when the US-Iran deal is finalised?

As a reminder, these are the other key terms that…

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• Japan one step from historic yen collapse, SMBC Nikko warns
• Australia widening current account deficit, inventory draw to weigh on Q1 GDP
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• White House trims tariffs on farm and industrial gear, tweaks metals regime
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• RBA's hawkish Harper…

Australia's net trade will subtract ~0.8ppt from Q1 GDP as data centre and fuel imports surged and commodity exports fell, with government spending flat and the current account deficit wider than forecast.

Earlier:

• Australia widening current account deficit, inventory draw to weigh on Q1 GDP
• RBA's hawkish Harper hints herald hike

Summary points:

• Net exports will subtract 0.8 percentage points from Q1 GDP, worse than the 0.5 point drag forecast, as trade in goods and services fell into deficit for the first time since December quarter 2017
• Imports of data centre equipment hit historic highs, driven by bulk AI server rack purchases for infrastructure build-out in New South Wales and Victoria, alongside a surge in fuel imports; mining commodity…

The White House announced adjustments to tariff arrangements covering aluminium, steel and copper imports, while cutting duties on agricultural equipment such as combines and harvesters from 25% to 15%.

Mobile industrial equipment including bulldozers and forklifts will also qualify for a 15% rate when imported from countries with existing trade agreements.

Building Permits m/m (Apr) -3.4%

• prior -10.5%

Building Permits y/y (Apr) +10.2%

• prior +9.0%

Private House Approvals m/m (Apr) -1.0%

• prior +0.9%

Business Inventories q/q (Q1) +0.5%

• prior -0.1%

Company Gross Profits q/q (Q1) -1.3%

• prior +5.8%

Net Exports Contribution to GDP (Q1) -0.8%

• prior -0.1%

Current Account (Q1) -A$27.1B

• prior -A$21.1B

Earlier:

• RBA's hawkish Harper hints herald hike
• Australia minimum wage rises 4.75%

Japan is considering cutting its 8% food sales tax to 1% from April 2027 for two years, the Mainichi reported, with the timeline designed to support PM Takaichi ahead of municipal elections.

Summary:

• Japan is considering a two-year cut to the 8% food consumption tax from April 2027, with the rate likely set at 1% rather than zero to avoid costly cash register system overhauls
• The April 2027 start date aligns with municipal elections, giving PM Takaichi's administration time to promote the policy to voters
• Takaichi pledged the food tax abolition in January; that announcement alone triggered a bond yield spike on fiscal deterioration concerns
• Japan charges 8% consumption tax on food and 10% on other goods, with revenue central to funding social…

• Manufacturing PMI 57.3 vs 53.5 expected
• Prior 54.5

The overall index jumps to a near three-year high but it comes amid a fresh decline in output and new orders on the month. Instead, the rise is largely in part driven by higher suppliers' delivery times - which increased by another 1.6 points to 65.7 in May. Just be wary that this sub-index tends to have a positive contribution to the overall headline estimate.

For some context, intensification of supply chain delays are normally viewed as a sign of busier vendors due to higher demand and positive in terms of economic growth. However, the Middle East conflict is not a telling sign of that as the deterioration in vendor times is largely tied to the effective closure of the Strait of Hormuz.