Markets Overview

  • ASX SPI 200 futures little changed at 8,465.00
  • Dow Average up 0.1% to 42,270.07
  • Aussie down 0.1% to 0.6435 per US$
  • US 10-year yield fell 1.7bps to 4.4004%
  • Australia 3-year bond yield fell 11 bps to 3.33%
  • Australia 10-year bond yield fell 11 bps to 4.26%
  • Gold spot down 0.9% to $3,289.25
  • Brent futures down 0.9% to $62.78/bbl

Economic Events

  • 09:00: (AU) May S&P Global Australia PMI Mfg, prior 51.7
  • 11:00: (AU) May Melbourne Institute Inflation, prior 0.6%
  • 11:00: (AU) May Melbourne Institute Inflation, prior 3.3%
  • 11:30: (AU) May ANZ-Indeed Job Advertisements , prior 0.5%

Asian markets are poised for a cautious open after US President Donald Trump said he would double tariffs on steel and aluminum imports. Oil climbed around 2% as a further supply boost vied with heightened geopolitical risk.

US equity futures slipped in early trading following Trump’s announcement on Friday in the US, while Asian contracts point to a soft start when markets reopen. Crude gained after OPEC+ agreed to lift output by 411,000 barrels a day, and following an escalation in Ukraine’s attacks on Russia.

The caution in stock markets comes after global shares notched their best month since November 2023 in May, as traders expect the worst of the US tariff threat has passed. Markets however now face the prospect of more uncertainty over trade policy and negotiations among US lawmakers on a sweeping tax and spending bill.

“Navigating the global economy and managing capital market volatility has always posed challenges, but the uncertainties emanating from Washington make this task exceptionally treacherous,” Marc Chandler, chief market strategist at Bannock burn Capital Markets wrote in a note.

US Treasuries delivered their first monthly loss this year in May, buffeted by renewed tariff uncertainty and growing anxiety over mounting levels of government debt. The 30-year yield rose for a third consecutive month, its longest losing streak since 2023, as Trump wrestles with Congress over a bill that promises to cut taxes.

Treasury Secretary Scott Bessent at the weekend said the US “is never going to default” as the deadline for increasing the federal debt ceiling gets closer.

Traders in Asia will soon shift focus to Hong Kong shares after Chinese factory activity data contracted at a slower pace in May than the month prior. Mainland markets are closed for a holiday.

Adding to sentiment, Trump and Chinese President Xi Jinping may hold a call later this week to ease tensions after White House officials late Friday accused Beijing of failing to comply with elements of the trade agreement.

“Shares are at high risk of renewed falls given the ongoing tariff uncertainties, concerns about US debt, likely weaker growth and profits and the risk of a US/Israeli strike on Iran’s nuclear capability if diplomacy doesn’t work,” Shane Oliver, head of investment strategy and chief economist at AMP Ltd., wrote in a note.