Manufacturing PMI shrunk for the 18th time in 19 months, raising concerns about the strength of the economy
US stocks were mixed on Monday, with the Dow Jones Industrial Average bucking the positive trend to begin June’s trading. The benchmark slipped 0.30%, while the S&P 500 inched higher by 0.11%, and the Nasdaq Composite added 0.56%. On the data front, the ISM manufacturing PMI came in at 48.7 in May to shrunk for the 18th time in 19 months. In individual stocks, Nvidia jumped nearly 5% after announcing a new suite of artificial intelligence chips.
In Asia, equities were mostly lower as investors were spooked by a weak economic report out of the United States which raised concerns about the strength of the economy. Japan’s Nikkei 225 index lost 0.35% and the Kospi in Seoul was down 0.76%. Hong Kong’s Hang Seng was the outlier, gaining 0.31%, and the Shanghai Composite index edged 0.41% higher as well. Australia’s S&P/ASX 200 shed 0.31%. MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.4%.
After starting the month higher Monday, European markets opened lower today, with the pan-European Stoxx 600 down 0.23% in opening trade. Now, investors are looking ahead to the ECB’s latest interest rate decision due on Thursday. The central bank is widely expected to cut interest rates for the first time since 2019 this week. US stock index futures are mostly lower in early pre-market deals, suggesting risk demand could stay muted at this stage.
In currencies, the US dollar has steadied after solid losses witnessed yesterday in a reaction to a weak economic report. The greenback plunged along with Treasury yields to challenge the 104.00 mark for the first time in nearly two months. The USD index could stay cautious in the days to come as traders shift focus to a key US jobs report dur on Friday. In the immediate term, the dollar needs to hold above the 104.00 figure.
