- Asian Equities Advance While Treasuries Hold Gains: Markets Wrap
Asian shares rebounded on increasing risk appetite, putting a regional gauge on course for a sixth consecutive
week of gains, and Treasuries steadied as concerns about US fiscal policy eased. The MSCI Asia Pacific Index
advanced 0.6% while futures for the S&P 500 rose 0.1%. Contracts for European stocks also gained. The yield
on the 30-year US Treasury held at 5.04%. The Bloomberg Dollar Spot Index dropped 0.2%, extending this
week’s loss to 1.2%. That’s the biggest move in six weeks. - S&P 500 closes little changed Thursday as investors worry about high yields hitting economy
The S&P 500 ended Thursday near flat, as investors grappled with fears of rising rates and worries about a
ballooning U.S. deficit. The 30-year Treasury yield hit its highest since October 2023 as lawmakers passed a bill
that investors fear could worsen the U.S. deficit. The Dow Jones Industrial Average slipped 1.35 points, closing
at 41,859.09. The S&P 500 lost 0.04% and ended at 5,842.01, while the Nasdaq Composite advanced 0.28%
and settled at 18,925.73. - Oil falls on stronger U.S. dollar, possibility of higher OPEC+ output
Oil prices slipped on Friday, weighed down by a stronger U.S. dollar and the possibility that OPEC+ will further
increase its crude oil output. Brent futures fell 37 cents to $64.07 a barrel by 0015 GMT. U.S. West Texas
Intermediate crude futures lost 39 cents to $60.81. Brent was down 2% on the week, and WTI was 2.7% lower.
The U.S. dollar strengthened against a basket of currencies on Thursday, boosted by the passage of President
Donald Trump’s bill for tax and spending cuts by the House of Representatives. Oil typically trades inversely
with the dollar because a stronger greenback makes the commodity more expensive for non-U.S. buyers. A
Bloomberg News report that OPEC+ was considering another large production increase at a meeting on June 1
also pushed oil prices lower. Increasing output by 411,000 barrels a day (bpd) for July was among the options
discussed, but no final agreement has yet been reached, the report said, citing delegates. Reuters previously
reported that OPEC+ would accelerate oil hikes. A large crude oil build in the U.S. earlier in the week also
weighed on oil prices. U.S. crude oil storage demand has surged in recent weeks to levels similar to the COVID
19 pandemic, according to data from storage broker The Tank Tiger, as traders brace for a flood of increased
supply in coming months from the Organization of the Petroleum Exporting Countries and its allies. On Friday,
the market will watch for U.S. oil and gas rig count data from Baker Hughes that is used as an indicator for
future supply. - Gold heads for best week in 1-1/2 months on U.S. fiscal worries
Gold prices were poised on Friday for their best weekly gain in more than a month, as a softer U.S. dollar and
mounting concerns over the deteriorating fiscal outlook for the world’s biggest economy boosted bullion’s
safe-haven appeal. Spot gold was up 0.3% at $3,303.09 an ounce, as of 0404 GMT. Bullion has risen 3% so far
this week and is on track for its best weekly performance since April 7. U.S. gold futures added 0.2% to
$3,302.80. The dollar has lost more than 1% so far this week and is set for its worst weekly performance since
April 7, making greenback-priced gold cheaper for holders of other currencies. “This week, trade optimism has
somewhat given way to worries about the U.S.’s fiscal situation, and the resulting hesitancy towards U.S. assets
has put gold back in the frame with investors,” said Tim Waterer, chief market analyst, KCM Trade. “Gold can
likely maintain its foothold above the $3,000 level while tariff, U.S. debt and geopolitical (tension) remain
swirling around financial markets.” The Republican-controlled U.S. House of Representatives passed a
sweeping tax and spending bill on Thursday, embedding much of President Donald Trump’s policy agenda and
adding trillions of dollars more to the national debt. - Trump tax bill clears the House in a victory for Republicans, advances to Senate
Republicans in the U.S. House of Representatives came together early Thursday to pass President Donald
Trump’s “big, beautiful” tax bill out of the chamber on a narrow, party line vote. The passage was a major
victory for Republican leaders, who spent the past two months crafting the bill and the past two days making
last-minute changes to it. The more than 1,000 pages of legislation and 42 pages of amendments are a case
study in how to win over both moderates and hardline conservatives. The House Rules Committee convened
for 21 straight hours of debate and amendments in order to meet Speaker Mike Johnson’s self-imposed
Memorial Day deadline for passing the bill. The package, comprised of tax cuts paired with cuts to the social
safety net, still faces a complicated path through the Senate. The upper chamber will consider the legislation
under a set of rules called budget reconciliation, which requires only a simple majority to pass instead of the
typical 60 votes required to move bills through the Senate. - Hong Kong passes stablecoin bill as more governments recognize the digital asset
Hong Kong passed a stablecoin bill on Wednesday to expand its cryptocurrency licensing regime as more
governments recognize the digital asset. Unlike volatile digital assets like bitcoin, the value of stablecoins is
tied to a real-world asset like fiat currencies or commodities like gold. The new law — focused on fiat
referenced stablecoins — will require stablecoin issuers to obtain a license from the Hong Kong Monetary
Authority and comply with a range of requirements, including proper management of asset reserves and
segregation of client assets. It will “enhance Hong Kong’s existing regulatory framework on virtual-asset (VA)
activities, thereby fostering financial stability and encouraging financial innovation,” the central banking body
said. It added that it would conduct further consultations on the detailed regulatory framework. The Hong
Kong government said in a statement that the stablecoins policy is expected to come into effect this year, with
“sufficient time” allowed for the industry to understand the requirements. - China says U.S. dialogue to continue as Beijing hints trade talks are advancing
The U.S. and China have agreed to maintain communication following a call between Chinese Vice Foreign
Minister Ma Zhaoxu and U.S. Deputy Secretary of State Christopher Landau, according to a brief readout
released by the Chinese Foreign Ministry on Friday. Both sides exchanged thoughts on crucial issues during the
call on Thursday, the statement said, without elaborating. The U.S. Department of State issued a similar
statement Thursday, briefly noting the consensus on the importance of the bilateral relationship and an
agreement to keep open lines of communication. The statement came as Beijing and Washington continued
to trade swipes at each other, despite the tariff de-escalation following a meeting between both sides in
Switzerland earlier this month. Chinese authorities pushed back against a U.S. decision that warned companies
not to use Chinese-made artificial intelligence chips, particularly those provided by Huawei Technologies.
China’s Ministry of Commerce earlier this week called the move “unilateral bullying” and blamed the U.S. for
undermining trade talks. - Japan’s core inflation climbs to 3.5%, highest in more than 2 years
Japan’s core inflation accelerated to 3.5% in April, government data showed Friday, bolstered in part by surging
rice prices, as the central bank considers pausing its rate hike posture to assess the impact of U.S. tariffs. The
core inflation figure, which strips out prices for fresh food, was higher than expectations of 3.4%, according to
economists polled by Reuters, rising from 3.2% in the previous month and marking the highest level since
January 2023. Headline inflation climbed 3.6% from a year ago, steady from the prior month and staying above
the Bank of Japan’s 2% target for more than three years. - Solar stocks sink as House approves GOP tax bill ending incentives earlier
Shares in solar names fell in premarket U.S. trading on Thursday after U.S. House Republicans voted on a
revamped version of a tax and spending bill that would cut into incentives for clean electricity production.
These tax credits would have been phased out over a longer period of time in an initial proposal of the
legislation, with some being allowed to remain until early in the next decade. But the fresh version would see
these incentives come to an end at an earlier time. Hardline Republican lawmakers had pushed for the speedier
timeline as part of a deal for their support of the wider budget bill. GOP officials have argued that the tax
credits mostly benefit already-mature solar and wind industries, rather than provide support to other clean
energy sources. Among the changes in the updated version, projects would be required to start construction
within 60 days of the tax bill’s enforcement in order to qualify for the tax credits. Republicans in the House of
Representatives narrowly voted to pass President Donald Trump’s so-called “big, beautiful” budget bill on
Thursday morning. The measure now goes to the GOP-controlled Senate, where it will also need to be approved
before being sent to Trump’s desk for signing. - Analog Devices, one of the biggest makers of chips used in industrial and automotive components,
reported strong earnings and a bullish outlook, but also cautioned that tariff announcements may have
caused a short-lived spike in vehicle-related orders
The tariff concerns sent the stock down 4.6%. Analog Devices projected revenue and profit that exceeded
analysts’ estimates. Executives at the chipmaker also said that underlying demand was improving. Still,
investors focused instead on comments indicating that there had been “pull-in” orders when the Trump
administration announced tariffs. That means customers made a rush of requests in an attempt to get out
ahead of the levies. Investors and analysts are concerned that device makers are just stocking up and will slow
orders if tariffs increase product prices and hurt demand. CFO Puccio and CEO Roche argued that there’s no
buildup of unused inventory. Orders are increasing, and the sale of devices that house the chips are strong,
they said, meaning that the fundamentals of the company’s markets are improving. - Nike is returning to Amazon’s online store after leaving it in 2019, part of efforts by the world’s largest
sportswear company to renew growth and mend ties with key wholesale partners
Shares of Nike rose 2.2%. The return to Amazon is part of Nike Chief Executive Officer Elliott Hill’s push to revive
relationships with retail partners since he came out of retirement to lead the company. He has pledged to
maintain an “unwavering commitment” to Nike’s wholesalers, which include stores such as Dick’s Sporting
Goods Inc. and Foot Locker Inc. His predecessor abandoned some retail partners in a bid to boost Nike’s own
sales channels, but that moved backfired and contributed to a sales slump. Independent merchants have sold
Nike products on Amazon in recent years, but those goods didn’t come directly from Nike. Amazon said that it
“will soon begin sourcing a much wider range of Nike products directly to expand our selection for US
customers.” The company is giving independent vendors “an extended period of time” to sell off overlapping
items. - Crypto-linked stocks gained after Bitcoin hit an all-time high. The world’s largest cryptocurrency reached
a record price of $111,878 on Thursday amid growing optimism around the US stablecoin bill
The US Senate has overcome a procedural blockade on stablecoin legislation, paving the way for debate on the
Senate floor, with a possible vote as soon as this week. Democrats had initially opposed the bill due to concerns
over President Trump’s crypto dealings, but some have dropped their opposition after negotiations and
modifications to the legislation. The bill still faces opposition from progressive Democrats, who argue it lacks
safeguards to prevent stablecoins from endangering the financial system and allowing criminals to exploit
them. Stablecoins are digital assets designed to hold a steady value, usually pegged to another currency. - Intuit reported strong revenue growth in its fiscal third quarter, with revenue increasing 15% to $7.8
billion, driven by its financial software services. Analysts, on average, estimated $7.6 billion
The company raised its revenue outlook for the full year to about $18.7 billion, and adjusted profit is expected
to be as much as $20.12 a share. Despite the strong results, Intuit reported a decline in free TurboTax users,
with 8 million expected to use the service this year, down 2 million from last year, and a 1 percentage point
decline in TurboTax’s total share of IRS tax returns. Shares gained 8% in afterhours trading. - Workday Inc. projected subscription revenue of about $2.16 billion in the period ending in July, in line
with Wall Street estimates
The company affirmed its full-year subscription revenue outlook of $8.8 billion and adjusted operating margin
for the full year will be 28.5%. Subscription sales rose 13% to $2.06 billion, in line with estimates, and profit,
excluding some items, was $2.23 a share in the period ended April 30. Shares fell 6.9% afterhours, as the results
disappointed investors looking for the software company to get a boost from new artificial intelligence
features. - Discount retailer Ross Stores fell 11.4% afterhours after pulling its full-year profit outlook due to
heightened uncertainty caused by tariffs
“There are simply too many unknown variables that are limiting our visibility into the second half of the fiscal
year,” Chief Executive Officer James Conroy said. More than half of the chain’s inventory originates in China.
The company expects tariff-related costs of as much as 16 cents per share in the second quarter. Earnings in
the period are forecast to be $1.40 to $1.55 per share, down from $1.59 per share a year ago and less than the
$1.65 analysts had estimated. - Ralph Lauren Q4 Earnings & Sales Beat Estimates, Dividend Up 10%
Ralph Lauren Corporation RL posted impressive fourth-quarter fiscal 2025 results, wherein the top and bottom
lines increased year over year and surpassed the Zacks Consensus Estimate. The fiscal fourth-quarter results
put an emphasis on the company’s strong brand momentum, operational discipline and strategic execution.
The results mark a successful close to the Next Great Chapter: Accelerate plan, while setting the stage for
continued growth in fiscal 2026 through diversified category, geographic and channel expansion.
RL reported adjusted earnings per share of $2.27, which surpassed the consensus estimate of $2.00. Also, the
bottom line increased 32.7% from $1.71 per share in the year-earlier quarter.
