Market Quick Take – 10 June 2025

Market drivers and catalysts

• Equities: US-China talks, tech M&A, cautious trading, inflation data ahead
• Volatility: VIX steady, short-term risk low, term premium remains
• Digital assets: Bitcoin steady, ETF inflows, crypto stocks advance, Gemini IPO
• Fixed Income: US yields await key Treasury auctions later this week, CPI tomorrow
• Currencies: JPY weakest amidst widespread strong risk appetite.
• Commodities: WTI breaks higher; Platinum surges to a 35% YTD gain
• Macro events: US-China trade talks in London

Macro data and headlines

• US President Trump has deployed 700 US Marines to Los Angeles to protect federal buildings as demonstrators against the president’s policy of launching raids on illegal immigrants. The President earlier deployed National Guard units in California, overriding California Governor Newsom, who is suing the president for this action.
• The NY Fed consumer inflation expectations dropped to 3.2% in May 2025 from 3.6% in April. Year-ahead commodity price expectations fell for gas, medical care, college education, and rent, while food prices rose to 5.5%, the highest since October 2023.
• Bessent called the US-China talks 'good', and Commerce Secretary Lutnick said they were "fruitful". Talks in London will continue Tuesday at 10 am after a 6-hour, 40-minute session on Monday.

Macro calendar highlights (times in GMT)

0600 – UK April Unemployment Rate
0800 – Italy April Industrial Production
0900 – US-China Trade Talks Continue in London
1700 – US Treasury to auction USD 58 billion of 3-year notes.

Earnings events

• Wednesday: Oracle, Inditex
• Thursday: Adobe, Kroger

For all macro, earnings, and dividend events check Saxo’s calendar.

Equities

• US: US stocks posted small gains on Monday as US-China trade talks began in London, easing worries about tariffs. The S&P 500 rose 0.1%, the Nasdaq gained 0.3%, and the Dow finished flat. Sentiment was lifted by hopes for progress on rare earth shipments and a pause in export restrictions. Apple fell 1% after a subdued AI update at WWDC, but Qualcomm surged 4% on its Alphawave deal. Investors remain cautious ahead of key US inflation data due Wednesday. Treasury yields edged lower, and earnings from GameStop and JM Smucker are in focus this week.
• Europe: European markets drifted slightly lower on Monday, as investors watched the US-China talks. The DAX fell 0.5% and CAC 40 lost 0.2%, with declines led by defense, banks, and tech. SAP and Siemens Energy lagged, while Alphawave and Spectris rallied on M&A news. Markets await inflation data from Germany, France, Spain, and Italy this week, which could guide central bank policy. The FTSE 100 slipped 0.1% as UK mid-cap M&A activity picked up, offsetting falls in WPP.
• UK: London’s FTSE 100 was nearly unchanged, closing down 0.1% amid little movement ahead of trade talks. M&A dominated headlines: Spectris jumped 64% on a takeover bid, and Alphawave soared nearly 19% after Qualcomm’s offer. The UK market continues to lose listed companies to foreign buyers, raising questions about domestic investment. Economic data is thin until unemployment and GDP figures later in the week, leaving markets driven by international headlines.
• Asia: Asian stocks were buoyed by optimism over US-China negotiations. The Hang Seng surged 1.6%, supported by tech gains and easing rare earth export tensions. South Korea’s KOSPI hit new highs on foreign buying and post-election optimism. Japanese and Australian indices also rose, helped by positive GDP data and global tech strength. Chinese data was weak, but hopes for stimulus remain as Beijing seeks to support the economy. Investors look to US inflation numbers and more trade talk progress.

Volatility

Market volatility stayed subdued to start the week. The VIX closed at 17.16, well below the mid-April spike above 40. Short-term measures like VIX1D eased to 12.28. The futures curve remains flat, signaling investors expect calm conditions in the near term. Demand for hedges has softened, and S&P 500 put-skew is lower. Still, a modest premium remains for longer-dated protection, reflecting some caution ahead of key inflation data and central bank meetings.

Digital Assets

Crypto markets steadied, with Bitcoin holding above $109,000 and Ethereum near $2,676. BlackRock’s IBIT spot Bitcoin ETF saw strong inflows, pushing assets above $70 billion and the share price up 4.4%. Ethereum’s ETHA ETF also gained 3.9%. Crypto-linked stocks (COIN, MSTR, MARA, RIOT, CLSK, CIFR) mostly advanced, tracking gains in major tokens. Sentiment improved as US-China talks offered hope for stability and investors anticipate key US CPI data. Meanwhile, Gemini filed confidentially for a US IPO, signaling continued institutional interest.

Fixed Income

• US Treasury yields dipped slightly yesterday after Friday’s surge on the stronger than expected US payrolls numbers for May. Focus this week for treasury traders will be on the Treasury auctions on Wednesday (auction of 10-year notes) and Thursday (auction of 30-year T-bonds) after that fresh rise in yields. US May CPI is up on Wednesday.

Commodities

• Platinum prices extended their recent strong run of gains, up 35% year-to-date, supported by a combination of tightening fundamentals and momentum buying following last month’s strong upside break. Against gold, the ratio has now slumped to 2.7-1 from a record cheap level of 3.6-1 just six weeks ago.
• Silver trades near USD 36.60 and has not looked back after breaking above USD 35 last week to reach a 13-year high. Just like platinum, silver is seen as relatively cheap compared to gold, and with gold in need of a fresh and, so far, elusive trigger to drive fresh gains, the focus has, for now, switched to its cheaper siblings.
• WTI crude trades above USD 65, a level that has provided support and subsequent resistance several times since last September. Brent, meanwhile, has yet to challenge resistance around USD 68.50. Recent strength is supported by "fruitful" US-China trade talks, a tightening spot market amid peak seasonal demand, and a slump in US rigs drilling for crude to a four-year low.

Currencies

• The US dollar is mixed to marginally stronger after the modest surge on Friday’s payrolls data, rebounding a bit from yesterday’s dip, but finding little momentum.
• USDJPY trades just below 145.00 this morning in Europe after an attempt above the level overnight was rebuffed. The pair has not closed above 145.00 in over three weeks. EURJPY teased above 165.21 overnight, a new high for the year, before pushing back lower to 165.00. EURUSD remains sticky near 1.1400.
• Several EM currencies continue to rise against the US dollar, with USDZAR posting new lows for the year in recent days and USDMXN having another strong push lower to new lows since August of last year.

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