United States
Wall Street ended mixed in a choppy session, as initial optimism following the newly signed trade deal with the European Union faded. Investors shifted their focus to a slate of upcoming economic data releases this week, including the highly anticipated interest rate decision from the Federal Reserve.
The S&P 500 closed marginally higher, adding just one point to finish at 6,389.77. Market breadth was weak, with eight of the eleven sectors closing in negative territory, led by declines in real estate and materials. The Nasdaq Composite rose 84 points, or 0.36%, while the Dow Jones Industrial Average slipped 0.14% to end the day at 44,837.56.
Technology stocks continued to show strength, with Nvidia gaining 1.87% to close at a record high of US$176.75. Market participants are awaiting key earnings reports from Microsoft and Meta, both due on Wednesday, followed by Apple and Amazon on Thursday. These results are expected to validate or challenge the recent tech-led rally. Price action in these names was muted as traders adjusted positions ahead of the announcements.
Tesla extended its gains for a second consecutive day, rising 3.02% after announcing a partnership with Samsung Electronics to source next-generation chips. The chips will be manufactured at Samsung’s Texas facility. CEO Elon Musk commented on the deal, saying the strategic importance of the new AI6 chip “is hard to overstate.”
Crude oil prices rallied on news of the trade agreement, which included a commitment by the EU to purchase US$750 billion worth of US energy. This lifted the energy sector by 1.15%, with notable gains in ConocoPhillips (+2.18%) and Decon Energy (+3.49%).
In the bond market, yields moved higher. The 10-year Treasury yield rose by 2 basis points to 4.41%, while the 30-year yield climbed to 4.96%. The US dollar also strengthened, reaching its highest level in a week with a 0.8% gain on the Bloomberg Dollar Index.
Looking ahead, today’s JOLTS report will offer an early read on the state of the labour market. Later in the week, markets will digest key inflation figures, non-farm payrolls data, the Fed’s rate decision, and major tech earnings—all of which have the potential to significantly influence market sentiment.
Europe
European markets opened the week on a positive note, reaching one-month highs after the EU–US trade agreement was officially signed with a lower-than-expected tariff rate of 15%. However, the optimism quickly faded as analysts and politicians criticised the deal as a form of damage control rather than a victory for Europe, given the US’s dominant negotiating position.
The Euro Stoxx 600 slipped 0.22% to close at 548.76, with seven of its sectors ending the session in negative territory. The German DAX suffered the sharpest decline among major regional indices, falling 1.02% as export-heavy carmakers led losses. In the UK, the FTSE 100 reversed early gains and closed 0.43% lower at 9,081.44.
Despite the newly reduced tariff on car exports—down to 15% from the previous 27.5%—auto stocks were heavily sold off. The sector dropped 1.76%, reflecting investor scepticism about the longer-term impact of the deal. Among the biggest losers were European car manufacturers, which remain heavily reliant on US markets with BMW falling 3.28% and Volkswagen down 3.58%.
Heineken led declines in the consumer goods space, tumbling 8.45% after announcing it was evaluating all strategic options in response to the new tariff regime, including potentially relocating manufacturing operations. The broader brewing segment followed suit, while spirits makers also faced selling pressure—Pernod Ricard shares fell 3.5%.
The aerospace and defence sector came under pressure as well, falling 1.48%, after reports emerged that the agreement included a commitment from European countries to purchase US military equipment. German defence contractor Rheinmetall slid 3.29% on the news.
Overall, the market response reflected unease over the long-term implications of the trade deal, with investors reassessing its impact across key export-oriented industries.
Australia
The Australian equity market began the week on a positive note, buoyed by news of a trade agreement between the European Union and the United States, which helped lift global equity futures. This optimistic tone supported gains in both the banking and healthcare sectors. The ASX 200 closed 30 points higher, rising 0.36% to finish at 8,697.70.
The financial sector was led by a rebound in the major banks, which recovered from recent selling pressure. All of the Big Four banks, along with Macquarie, posted solid gains. Commonwealth Bank rose 1.17%, while Macquarie advanced 0.97%. Among asset managers, Netwealth gained 2.35% and Magellan surged 4.60%.
CSL continued its upward trend, rising 1% to close at $270.95, as optimism grew that recently signed trade deals would soften the impact of potential tariffs on pharmaceutical products. Hearing device manufacturer Cochlear also performed well, adding 1.33% to finish at $317.00.
Iron ore prices extended their decline in Asian trade, falling a further 1%. This weighed on major miners, with BHP down 1.23% and Rio Tinto dropping 1.61%. Lithium producers saw even sharper losses amid falling lithium prices in Chinese markets—Mineral Resources slid 6.44% to $30.24, while Pilbara Minerals plunged 11.69% to $1.70.
Coal miners also came under pressure. Whitehaven Coal fell 4.17% to $6.66 following the release of its fourth-quarter production guidance last Friday. While output was at the upper end of expectations and costs at the lower end, investors nonetheless sold off the stock 4.17%, making it a two-day loss of 5.3%. Yancoal also declined, falling 2.62% on Monday.
The biggest decliner in the sector was Boss Energy, which collapsed 44% to $1.905. The company issued guidance that raised concerns over uranium quality and revised its production outlook downward. It also provided cost guidance for 2026 that exceeded analysts’ expectations by as much as 25%. Other uranium miners fell in sympathy, with Deep Yellow losing 8.3%. Overall, the energy sector dropped 1.42%.
Bond yields remained unchanged, while the Australian dollar weakened, starting Tuesday at 0.6520.
The Australian equity market is expected to open weaker, following a reversal in sentiment that saw global markets retreat overnight. Optimism that had driven gains in international index futures on Monday quickly dissipated, weighing on risk appetite. ASX 200 futures ended their session down 60 points, or 0.69%, indicating a soft start to Tuesday’s trading.
Commodities
Oil prices climbed overnight, supported by expectations of increased global economic activity following the signing of the EU–US trade agreement. Brent crude rose 2.57%, gaining US$1.76 to close at US$70.20. West Texas Intermediate (WTI) also advanced, finishing at US$66.71—up 2.38% on the session.
Additional buying pressure emerged after US President Donald Trump announced a shortened timeline for Russia to reach a resolution over the Ukraine conflict, reducing the original 50-day window to just 10–12 days. The increased geopolitical risk added further support to crude markets.
Meanwhile, gold prices declined as traders adjusted to a stronger US dollar and diminished safe haven demand amid recent trade agreements. Gold slipped US$22.69, or 0.68%, to settle at US$3,314. Silver prices were unchanged at US$38.17.
In base metals, London copper edged higher by 0.25% to close at US$9,793.20 per metric tonne. However, copper futures in New York fell sharply—plunging as much as 6% during the session before closing 2.92% lower—after reports emerged that Chile, the US’s largest copper supplier, was seeking an exemption for copper in ongoing tariff negotiations.
Iron ore showed some resilience in US trading, ending at US$101.50—a modest US$0.30 decline from the previous close in NY. This followed a 1% drop in Monday’s Asian session.
Economic Calendar
US:
- Home Prices (May) – 11:00pm
- JOLTS Job Openings (Jun) – 12:00am
This article was written by Paul Darwell, Rivkin Securities Pty Ltd. Enquiries can be made via [email protected] or by phoning +612 8302 3632.
