- Stock Futures Rise on Trade Talks, Dollar Weakens: Markets Wrap
Stock-index futures advanced and Asian equities edged up as progress in several trade negotiations boosted
risk appetite. Contracts for the S&P 500 rose 0.4% after the index closed at a record Friday. Futures for
European stocks advanced 0.4%. Asian shares rose 0.2% with the Nikkei-225 index jumping 1.5% after Japan’s
top negotiator extended his stay in the US for further talks. The Canadian dollar strengthened after the country
rescinded its digital services tax to advance discussions with the US. - S&P 500 closes at a record Friday, overcoming even more trade angst
The S&P 500 hit fresh records on Friday as traders managed to look past new comments from President Donald
Trump tied to U.S.-Canada tariffs. The broad market index’s rise to new highs marks a sharp turnaround from
the lows seen in April during the height of trade policy tensions. The benchmark added 0.52% and closed at a
record of 6,173.07. Earlier in the session, the S&P 500 rose as much as 0.76% to a high of 6,187.68, taking out
its previous record of 6,147.43. The Nasdaq Composite, which also hit an all-time high and closed at a record,
rose 0.52% to 20,273.46. The Dow Jones Industrial Average added 432.43 points, or 1%, settling at 43,819.27.
Stocks pulled back from their session highs after Trump said on Truth Social that trade talks between the U.S.
and Canada were being terminated. Initially, investors bid up equities after Commerce Secretary Howard
Lutnick told Bloomberg News late Thursday that a framework between China and the U.S. on trade had been
finalized. Lutnick added that the Trump administration expects to reach deals with 10 major trading partners
imminently. - Oil falls on prospect of more OPEC+ supply, easing risks in Mideast
Oil prices fell 1% on Monday as an easing of geopolitical risks in the Middle East and the prospect of another
OPEC+ output hike in August boosted the supply outlook. Brent crude futures fell 66 cents, or 0.97%, to $67.11
a barrel by 0031 GMT, ahead of the August contract’s expiry later on Monday. The more active September
contract was at $65.97, down 83 cents. U.S. West Texas Intermediate crude dropped 94 cents, or 1.43%, to
$64.58 a barrel. Last week, both benchmarks posted their biggest weekly decline since March 2023, but they
are set to finish higher in June with a second consecutive monthly gain of more than 5%. A 12-day war that
started with Israel targeting Iran’s nuclear facilities on June 13 caused Brent prices to surge above $80 a barrel
after the U.S. bombed Iran’s nuclear facilities and then slump to $67 after President Donald Trump announced
an Iran-Israel ceasefire. The market has stripped out most of the geopolitical risk premium built into the price
following the Iran-Israel ceasefire, IG markets analyst Tony Sycamore said in a note. Further weighing on the
market, four delegates from OPEC+, which includes allies of the Organization of the Petroleum Exporting
Countries, said the group was set to boost production by 411,000 barrels per day in August, following similar
size output increases for May, June and July. OPEC+ is set to meet on July 6 and this would be the fifth monthly
increase since the group started unwinding production cuts in April. - Gold rebounds from over one-month low on weaker dollar
Gold reversed course and edged higher on Monday, supported by a weaker dollar, after hitting a more than
one-month low earlier as easing U.S.-China trade tensions dampened safe-haven demand and bolstered risk
appetite. Spot gold rose 0.3% to $3,281.65 per ounce, as of 0216 GMT, after hitting its lowest since May 29
earlier in the session. U.S. gold futures were up 0.2% at $3,293.30. “There is less of a ‘doom and gloom’ outlook
surrounding both tariff talks and events in the Middle East, which is relegating gold to play second fiddle to risk
assets,” KCM Trade Chief Market Analyst Tim Waterer said. Asian shares firmed, with Wall Street futures
advancing, while U.S. dollar index fell 0.2%. A lower dollar makes greenback-priced bullion less expensive. The
U.S. and China have resolved issues surrounding shipments of rare earth minerals and magnets to the U.S.,
Treasury Secretary Scott Bessent said on Friday, adding, the Trump administration’s various trade deals with
other countries could be done by the September 1 Labor Day holiday. Spot silver was down 0.1% at $36.02 per
ounce. - Core inflation rate rose to 2.7% in May, more than expected, Fed’s preferred gauge shows
Prices that consumers pay rose slightly in May, while the annual inflation rate edged further away from the
Federal Reserve’s target, according to a Commerce Department report Friday. The personal consumption
expenditures price index, the Fed’s primary inflation reading, rose a seasonally adjusted 0.1% for the month,
putting the annual inflation rate at 2.3%. Economists surveyed by Dow Jones had been looking for respective
levels of 0.1% and 2.3%. Excluding food and energy, core PCE posted respective readings of 0.2% and 2.7%,
compared to estimates for 0.1% and 2.6%. Fed policymakers consider core to be a better measure of long-term
trends because of historic volatility in the two categories. The annual rate was 0.1 percentage point ahead of
the April reading. - Trump ends all U.S. trade talks with Canada over digital services tax
President Donald Trump on Friday said the United States is immediately “terminating ALL discussions on Trade
with Canada” in response to Ottawa’s decision to impose a digital services tax on American tech firms. Trump’s
announcement on Truth Social accused Canada of “copying the European Union” with the “egregious” tax.
“We will let Canada know the Tariff that they will be paying to do business with the United States of America
within the next seven day period,” Trump added. The office of Canadian Prime Minister Mark Carney did not
immediately respond to CNBC’s request for comment. The president’s angry declaration suddenly imperils
America’s trade relationship with a close ally that has long been one of its top two global trading partners. U.S.
goods trade with Canada totaled roughly $762 billion last year, according to the office of the U.S. trade
representative. - China’s manufacturing activity contracts for a third month amid deflation woes
China’s manufacturing activity contracted for a third straight month in June, an official survey showed on
Monday, despite Beijing’s stimulus efforts helping to stabilize certain aspects of the industrial sector. The
official purchasing managers’ index (PMI) improved slightly to 49.7 in June from 49.5 in May but stayed below
the 50-benchmark separating expansion from contraction, according to data from the National Bureau of
Statistics. That figure was in line with analysts’ forecasts in a Reuters poll. The sub-index tracking production
rose to 51, and the gauge tracking new orders ticked higher to 50.2, indicating improvement in industrial
activity and demand, according to NBS senior statistician Qinghe Zhao. Inventory and employment levels at
factories, however, continued to decline, coming in at 48 and 47.9, respectively. The non-manufacturing PMI,
which includes services and construction, rose to 50.5 from 50.3 in May. The services sub-index slipped to 50.1
while that of construction accelerated to 52.8, as infrastructure projects continued to progress at a relatively
fast pace. Mainland China’s benchmark CSI 300 index jumped 0.22% following the data release. - Nike released its fourth-quarter earnings after the market closed Thursday, revealing a revenue decline
of 10% and a drop in net income of 86%. The company also warned of as much as $1 billion in tariff-related
costs
Yet, shares of Nike soared 15% on Friday after the sneaker giant suggested that better times were ahead. CFO
Matthew Friend said he expected the “headwinds to moderate from here” during Thursday’s earnings call.
Investors are buying into the turnaround plan being implemented by Elliott Hill, who took over as CEO in
October. Jefferies analyst Randal Konik says the fourth quarter was an inflection point and the bottom of Nike’s
turnaround in a research note sent out Friday morning. “We still see a V-shaped recovery in F27 as innovation
resonates and margins rebound,” Konik wrote. “Mkt cap at 10-year lows and near 15-yr lows on EV/Sales = Just
BUY It!” Friday’s stock move was the third-biggest one-day gain for the company after slightly higher moves in
2021 (15.5%) and 1987 (16.7%). It was welcome relief for investors who have stuck with the swoosh, which has
struggled with its innovation pipeline and faced competition from longtime rival Adidas as well as newer brands
such as On and Hoka. Last year, Nike’s stock was the second-worst performer among the 30 components of
the Dow Jones Industrial Average, with a 30% decline over the period. It closed at $53.27 on April 8 for a market
cap of $82 billion, down from a peak of $281 billion. After Friday’s gains, Nike’s stock is down 4.8% year-to
date. In contrast, the S&P 500 is up 5% and closed Friday at a new all-time high. - Parvus Asset Management, a UK-based activist investor, now owns 5% of troubled luxury group Kering
SA, a regulatory filing showed
Parvus didn’t immediately respond to a request for comment. Kering declined to comment. The disclosure may
raise pressure on Kering for more changes after the Gucci owner named Luca de Meo, who guided
carmaker Renault SA in a turnaround, as its next chief executive officer. When he assumes the role in
September, he’ll look to reverse a share slump that’s wiped out nearly 80% of the company’s value since
peaking in 2021. Kering Chairman Francois-Henri Pinault is stepping down as CEO but will stay on as chairman.
The company is controlled by the Pinault family through a 42% stake via their holding Artemis. The Financial
Times reported earlier this month that Parvus built a stake in Novo Nordisk A/S. Two years ago, Bloomberg
News reported activist investor Bluebell Capital Partners Ltd built a stake in the owner of Gucci and Yves Saint
Laurent. - Newmont, the Colorado-based gold miner, was one of the worst-performing stocks in the S&P 500 Friday
as the price of gold slumped from its June record high
Newmont shares were falling 3.9%, putting the stock on pace for its third drop in four days and a weekly loss,
according to Dow Jones Market Data. Gold futures, meanwhile, were down 2.1% to $3,278.30 per Troy ounce.
Gold miners and gold itself have been on a tear this year as investors bought up the precious metal as a safe
haven asset amid global trade turmoil. Gold futures hit an all-time high of $3,452.80 per Troy ounce on June
13, according to Dow Jones Market Data, though they have since dipped as some investors pivoted back to
risk-on assets. Newmont stock, meanwhile, has risen 59% this year as of Thursday’s close, and competitors like
Barrick Mining and Agnico Eagle Mines have also seen their share prices soar. But they are vulnerable to
downward shifts in the price of bullion, too — including Friday’s decline. New York-listed shares of Barrick and
Agnico Eagle were down 3% and 5.5%, respectively, on Friday. - China’s biggest public AI drop since DeepSeek, Baidu’s open source Ernie, is about to hit the market
Chinese search giant Baidu has said it will make its Ernie generative AI large language model open source on
June 30, a threat to OpenAI, Anthropic and its own Chinese rival DeepSeek. Tech experts are divided. Some
say it won’t be another “DeepSeek” moment for the U.S. market, while others say Ernie’s release could cement
China’s position as the undisputed AI leader. “This isn’t just a China story. Every time a major lab open-sources
a powerful model, it raises the bar for the entire industry,” Sean Ren, associate professor of Computer Science
at the University of Southern California and Samsung’s AI Researcher of the Year, told CNBC.
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