United States
U.S. equity markets rose on Tuesday as investor sentiment improved following comments from the White House suggesting that Chinese President Xi Jinping and U.S. President Donald Trump are likely to meet later this week. Traders interpreted the potential meeting as a positive development for ongoing trade negotiations, leading to gains across major indexes—particularly among semiconductor stocks.
The Nasdaq Composite climbed 0.81% (up 156 points) to close at 19,398, while the Dow Jones Industrial Average added 0.51%, finishing at 42,519. The S&P 500 gained 34 points, or 0.58%, closing at 5,970.37. The gains were led by strength in the technology and energy sectors, supported by rising oil prices.
Nvidia boosted the tech sector with a 2.80% rise to $141.22. Other notable semiconductor performers included Broadcom (+3.27%) and Micron Technology (+4.15%) Broadcom announced it had begun shipping its newest chips designed to accelerate AI processing, adding momentum to the rally.
In related AI news, Meta signed a 20-year agreement with Constellation Energy to supply nuclear power, highlighting the growing connection between technology companies and nuclear energy providers as AI demands continue to drive up energy consumption. Despite the announcement, Meta shares dipped 0.60% to $666.85, while Constellation Energy fell 0.33%.
The energy sector of the S&P 500 rose 1.11%, benefiting from higher crude prices and growing optimism that economic growth may be more resilient than previously feared.
On the economic front, the JOLTS report showed a rise in job openings alongside the largest increase in layoffs in nine months—though layoffs remain low in absolute terms. Economists noted that uncertainty stemming from U.S. trade policy changes has made long-term planning difficult for many businesses. Meanwhile, factory orders declined 3.7% in April, reversing the gains made in March as companies had front-loaded purchases ahead of anticipated tariffs.
Bond markets were relatively steady, with the 10-year Treasury yield rising 1 basis point to 4.45%, and the 2-year also ticking up 1 basis point to 3.95%. The U.S. dollar rebounded gaining 0.43% on the Bloomberg Dollar Index.
Europe
European equities ended little changed on Tuesday, as easing inflation in the eurozone failed to lift investor sentiment. The Euro Stoxx 600 edged up just 0.09% to close at 548.44. The latest inflation reading came in at 1.9%, now below the ECB’s 2% target, reinforcing expectations of a 25-basis point rate cut at the central bank’s meeting on Thursday.
Within the index, technology and energy stocks outperformed—mirroring gains in the U.S.—while materials and utilities lagged.
In the UK, the FTSE 100 rose 0.15% to 8,787, supported in part by a rally in defence stocks after Prime Minister Rishi Sunak announced the country’s largest increase in defence spending since the Cold War. Rolls-Royce surged 2.92%, and BAE Systems added 1.95%.
Meanwhile, the OECD revised down its global growth forecast, cutting its estimate for 2024 from 3.3% to 2.9%, and forecasting 3.0% growth for 2026. The downgrade reflects the greater-than-expected impact of rising global tariffs. For the U.S., growth is expected to slow to 1.5% next year if current policies persist. The Eurozone growth outlook for 2026 remained unchanged at 1.2%.
In Switzerland, inflation turned negative, falling 0.1% year-on-year in May, largely due to the strength of the Swiss franc. The unexpected drop in prices has raised speculation that negative interest rates could return. The Swiss benchmark rate currently stands at 0.25%, with economists expecting a cut to 0% in the coming months.
Bond markets were relatively stable. German 10-year yields held steady at 2.52%, while UK 10-year yields fell 3 basis points to 4.63%.
Australia
Australian equities extended their gains on Tuesday, with the ASX 200 rising by 52 points (+0.63%) to close at 8,466.70 — the highest closing level since February. The index now sits just 1.75% below its all-time high. Market breadth was positive, with nine sectors advancing and only two in decline. However, trading volume was slightly below the 15-day average.
The financial sector led the rally, climbing 1.24%. All four major banks posted gains exceeding 1.20%, with Westpac leading the pack, up 1.37% to $32.62. Commonwealth Bank reached a record high, closing at $178.64 (+1.26%). Insurers performed even more strongly, as Suncorp jumped 2.42% to $21.14 and IAG surged 2.92% to $8.80.
In the materials sector, performance was mixed. Iron ore stocks edged lower, while gold miners rallied on the back of higher bullion prices. Among large-cap stocks, gold producers were the standout performers: Genesis Minerals rose 4.62%, Newmont gained 4.26%, and Evolution Mining advanced 3.95% to close at $9.48. Energy stocks also benefited from rising oil prices, posting modest gains.
Today sees the release of first quarter GDP by the Australian Bureau of Statistics. Economists are expecting a jump in the yearly GDP to 1.5% from 1.3% recorded in the December quarter. Meanwhile, bond markets remained subdued, with the yield on 10-year government bonds easing by 1 basis point to 4.25%.
Overnight the ASX200 futures had a small gain adding 23 points up 0.27%. The AUDUSD slipped slightly to 0.6465 down 0.46% as it consolidates above 0.64c.
Commodities
Oil prices continued their upward momentum, rising 1.4% on Tuesday as traders responded to growing geopolitical tensions, which could tighten global supply. Hopes for a potential Ukraine–Russia ceasefire faded, increasing the likelihood that sanctions on Russia will remain in place for longer. Meanwhile, U.S.–Iran nuclear negotiations remain a geopolitical flashpoint.
West Texas Intermediate (WTI) rose 1.42% to US$63.41, while Brent crude added 95 cents to US$65.58.
Gold prices retreated after several days of strong gains, falling US$28.16 or 0.83% to US$3,353. Analysts suggest the market may now enter a period of consolidation, with further moves likely dependent on the outcome of upcoming U.S.–China trade discussions. Silver also declined, dropping 0.70% to US$34.52.
In industrial metals, iron ore rebounded slightly, with Singapore futures closing at US$95.15 during New York trade—a 0.20% gain over 24 hours. Prices had dipped below US$94 earlier in Asian trade following disappointing Chinese manufacturing PMI data, which came in at 48.3, signalling a contraction in activity.
Copper was marginally higher, rising 0.19% to US$9,634 per tonne on the London Metal Exchange (LME).
Economic Calendar
AU:
- GDP Growth March Quarter – 11.30am
US:
- ADP Employment Change (May) – 11:45pm
- ISM services Index (May) – 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.
