The first week of June brings a mix of critical economic data, central bank decisions, and political developments that are likely to shape market sentiment. With investors closely watching the European Central Bank’s next move and the upcoming US jobs report, markets are poised for potential shifts in expectations around inflation, interest rates, and global growth.
KEY INDICATORS
Political events
1 June: Second round of the Polish presidential election.
3 June: South Korean presidential election.
Canada’s Carney welcomes US court’s decision on tariffs.
Israel approves latest US ceasefire proposal for Gaza; Hamas yet to respond.
Trump could ask Supreme Court to halt tariff block as soon as Friday.
Monetary policy and economic regulation
Asia FX muted as dollar stems losses amid Trump tariff swings; PCE data on tap.
BofA sets AUD/JPY target at 100, cites Japan elections and RBA pause.
US ethane exports to China hit new roadblock with licence requirement.
Dollar edges higher on US court ruling; risk sentiment boosted.
Fed Chair Powell met with Trump at the White House on Thursday and told him rate decisions can’t be political.
Markets, energy, and institutions
Gold falls as traders await US data for clues to tariff impacts.
Dow, S&P 500, Nasdaq futures slip as Trump’s tariffs run into legal trouble.
Oil poised for second weekly loss ahead of OPEC+ supply decision.
STOXX 600 edges down on US trade uncertainties; set for monthly gains.
Japan stocks lower at close of trade; Nikkei 225 down 1.25%.
MARKET MOVERS
Nasdaq 100
Technical breakout: A breakout above the $21,400 resistance zone is in focus. Sustained movement above this level, especially on strong volume, would confirm bullish momentum.
Target projection: If the breakout holds, the next upside target lies at $21,625–$21,900 based on recent Fibonacci extensions and upward channel projections. In a strong bullish continuation, $22,100 could be in play.
Opening expectation: Futures suggest a mildly positive start to the week, with markets cautiously optimistic following ECB rate cut expectations and US job data.
Support zone: Immediate support lies at $20,900, with stronger support at $20,650–$20,700. A breakdown below this zone could invite deeper corrective moves towards $20,400.
Strategy: Bullish bias if price holds above $21,400, targeting $21,750+ with tight trailing stops. Caution warranted ahead of Friday’s non-farm payrolls — a weaker-than-expected print could increase volatility.
Technical breakout: Gold is currently trading around $3,300, consolidating within a symmetrical triangle pattern. A decisive breakout above $3,325–$3,330 could signal a bullish continuation, potentially targeting higher resistance levels. Conversely, a breakdown below $3,280 may indicate a bearish trend, opening the path to lower support zones.
Target projection (bearish scenario): A drop below $3,280 may see gold prices decline towards $3,250, and potentially further to $3,200 if selling pressure intensifies.
Opening expectation: The market is expected to open near the $3,300 level, reflecting a neutral stance as traders await key economic data releases. Price action is likely to remain range-bound until a clear directional catalyst emerges.
Support zone: Primary support: $3,280–$3,250, secondary support: $3,200. These levels are critical; a breach below could accelerate downward momentum.
Strategy (bearish approach): Short positions may be viable if price breaks below $3,280, aiming for $3,250 and $3,200.
Technical breakout: WTI crude oil is currently trading around $61.12, exhibiting a bearish trend. A decisive break below the $60.09 support level could signal further downside potential. Conversely, a sustained move above $61.46 may indicate a bullish reversal, targeting higher resistance levels.
Target projection (bullish scenario): A breakout above $61.46 could lead to a rally towards $63.74, with further momentum potentially reaching $64.19.
Opening expectation: The market is expected to open near the $61.12 level, reflecting cautious sentiment amid concerns over potential OPEC+ production increases and global demand uncertainties.
Support zone: Primary support: $60.09, secondary support: $59.10, third support: $58.14.
Strategy (bullish approach): Long positions may be viable on a confirmed breakout above $61.46, aiming for $63.74 and $64.19, with a stop-loss below $60.09.
European Central Bank policymakers are expected to deliver a final interest rate cut in June before entering a pause phase, as evolving economic conditions warrant a more cautious approach.
Seasonal trends point to potential strength in EUR/USD and AUD/USD in June, offering bullish momentum for both currency pairs amid dovish policy expectations.
Oil slips, tech shines, tariffs weigh
WTI crude oil prices have dropped to four-year lows, driven by accelerated production hikes from OPEC+, fuelling concerns over a growing supply glut.
Gold futures edged lower as a strengthening US dollar dampened investor demand for the precious metal.
Wall Street futures slipped as renewed tariff concerns resurfaced following a US federal appeals court ruling.
Meanwhile, strong earnings from AI leader Nvidia helped offset broader uncertainty, boosting investor confidence in the technology sector.
India gains, Japan slows
Japan’s factory output declined by 0.9% month-on-month in April, signalling ongoing challenges in its manufacturing sector.
In contrast, India’s GDP growth gained pace in the March quarter, supported by robust rural demand and increased state spending, suggesting growing economic momentum.
