Pre-market trading on Thursday, June 4th, shows a mixed picture for major US stock index futures.
As of the latest update, Dow Jones futures are up 0.89%, while S&P 500 futures have declined by 0.36%. The tech-heavy Nasdaq 100 futures are under more significant pressure, falling 1.28%.
In European markets, Germany's DAX index is up 0.54%, and France's CAC 40 has gained 1.03%. Conversely, the UK's FTSE 100 is down 0.36%, and the Euro Stoxx 50 index is up 0.27%.
Commodity markets are seeing a pullback, with WTI crude oil dropping 3.36% to $92.79 per barrel and Brent crude falling 3.11% to $94.77 per barrel.
Market Developments
Former US President Donald Trump suggested that an agreement between the US and Iran could be reached as early as this weekend. Speaking from the White House on the evening of the 3rd, Trump stated that negotiations are progressing well. He downplayed recent Iranian actions against Kuwait, calling them "not a big deal" and asserting that the situation was under control. He added that the Strait of Hormuz would reopen "immediately" upon a deal being struck, pending final mine-clearing operations in certain areas.
New York Federal Reserve President John Williams stated that interest rates are currently at a "very good place" and he sees no signs of persistently rising inflation. He indicated that monetary policy is appropriately positioned, with no immediate need for either rate hikes or cuts. Williams views the current energy price increases as more of a one-time shock rather than a trend that will drive sustained inflation, though he is monitoring for any signs of inflation becoming more entrenched.
The Bank of Japan appears to be moving closer to a policy shift, with the probability of a 25-basis-point rate hike in June now estimated near 90%. Officials are reportedly considering raising the benchmark rate to 1% at the upcoming policy meeting ending June 16th, with further hikes possible later this year. The decision will be data-dependent, with officials weighing persistent inflation risks against global uncertainties.
South Korea's Finance Minister, Joo Hyung-hwan, pledged that authorities would take immediate intervention measures if the foreign exchange market experiences severe or abnormal volatility. He stated the government is maintaining high vigilance and monitoring the market in real-time to prevent external uncertainties from fueling panic, promising prompt action to calm any excessive market swings.
Iron ore prices have dropped to a two-month low, extending losses this week due to increased supply and seasonally weak steel demand. Futures in Asia fell 1.1% to $102.50 per ton, hitting the lowest intraday level since April 14th. Growing global shipments and strong coking coal prices, which are squeezing steelmaking margins, are contributing to the pressure on iron ore.
Key Company News
AI chip giant Broadcom (AVGO.US) reported better-than-expected second-quarter results but disappointed investors with its AI chip revenue outlook, suggesting its progress in capturing market share in the fast-growing sector may be slower than anticipated. The stock plunged nearly 15% in pre-market trading. For Q2, revenue reached a record $22.2 billion, up 48% year-over-year and beating estimates, while adjusted EPS of $2.44 also topped forecasts.
Cybersecurity firm CrowdStrike Holdings, Inc. (CRWD.US) saw its shares tumble over 10% pre-market despite reporting Q1 revenue and adjusted EPS that exceeded market expectations and raising its full-year guidance. The sharp decline reflects that merely beating high expectations was insufficient for a stock that had surged nearly 70% in the past month, as investors were looking for a more spectacular performance.
Foxconn announced a strategic partnership with Intel (INTC.US) to jointly develop and deploy next-generation AI infrastructure and intelligent computing platforms. The collaboration aims to create comprehensive AI solutions spanning chips, racks, systems, and application layers, focusing on AI data center equipment, high-speed interconnects, thermal design, and energy efficiency. The partnership will also explore AI systems for applications beyond traditional data centers, such as factories, smart cities, and robotics.
Uber (UBER.US) is advancing cost-cutting efforts by laying off 23% of its human resources department, affecting dozens to hundreds of employees. This represents "far less than 1%" of the company's total workforce of 34,000. The company's new president stated the move aims to create a more connected, modern, and operationally excellent organization by addressing teams that had become overly complex and disconnected from the business they support.
Upcoming Economic Data and Events
Scheduled releases include US Initial Jobless Claims at 8:30 PM Beijing Time, followed by a speech from FOMC member Mary Daly at 11:40 PM Beijing Time.
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