US stock outlook | Futures of the three major stock indexes are rising, traders are waiting for evening ISM manufacturing data

Zhitongcaijing · 06/03 11:49

1. On June 3 (Monday), the futures of the three major US stock indexes rose sharply before the US stock market. As of press release, Dow futures were up 0.03%, S&P 500 futures were up 0.27%, and NASDAQ futures were up 0.49%.

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2. As of press release, the German DAX index rose 0.73%, the British FTSE 100 index rose 0.06%, the French CAC40 index rose 0.23%, and the European Stoxx 50 index rose 0.57%.

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3. As of press release, WTI crude oil rose 0.14% to $77.10 per barrel. Brent crude rose 0.20% to $81.27 per barrel.

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Market news

The 10-year US Treasury yield hit a new low in nearly a week, and traders are waiting for evening ISM manufacturing data. US manufacturing data is about to be released, providing an update on how much the Federal Reserve may cut interest rates this year. The price of US Treasury bonds rose, and the benchmark yield fell to its lowest level in nearly a week. According to the data, longer-term US Treasury bonds led the market. Previously, moderate inflation data released last Friday suggested that the Federal Reserve would cut interest rates at least once this year. The next data to be released will be the manufacturing PMI index and ISM manufacturing data. The market generally expects that both data will show the resilience of the US economy. Since the Federal Reserve has previously stated that the speed of interest rate cuts will depend on economic data, the market has become highly sensitive to every data point. Last month, 10-year US Treasury yields fell by about 20 basis points. Inflationary pressure eased due to signs that the job market is cooling down.

A “watershed” in monetary policy has arrived! The ECB is leading a new round of interest rate cuts this week. The ECB will cut interest rates for the first time in this cycle on Thursday. There are differences between its policy path and the US. This move may open the door for the euro to depreciate. With interest rate cuts of 25 basis points almost a foregone conclusion, ECB officials will finally accept the fact that the borrowing cost gap between the two sides of the Atlantic is widening. ECB policymakers, led by President Lagarde, insist that they are willing to act separately from the Federal Reserve, even if this could cause the euro to weaken and thus trigger inflation. Investors will also pay attention to the ECB's quarterly forecast released on Thursday and Lagarde's press conference to find clues about future policy trends. The money market is currently betting that interest rates will be cut twice this year, and it is very unlikely that interest rates will be cut a third time. The money market is currently betting that interest rates will be cut twice this year, and it is very unlikely that interest rates will be cut a third time.

This week's market focus: America's non-agricultural industry hit in May, and the AI investment boom is facing a test. The US stock market closed down in the last week of May, as investors' enthusiasm for artificial intelligence seemed to have cooled down, and the prospect that the Federal Reserve will keep interest rates higher for a longer period of time remains a top concern. In the coming week, the US May non-farm payrolls report will be the focus of investors' attention, and job vacancy data will also be released. In terms of corporate earnings, CrowdStrike (CRWD.US), Lululemon (LULU.US), and Dollar Tree (DLTR.US) will announce earnings this week. According to data released at the end of May, US PCE increased 2.7% year on year in April, in line with expectations; 0.2% month-on-month increase, the lowest month-on-month increase since 2024, lower than market expectations of 0.3%; core PCE grew 2.8% year on year and 0.3% month on month, all in line with expectations.

“Wall Street magic calculator”: US stocks can still rise! Investors should stick to effective strategies. As the market entered June, major stock indexes (such as the S&P 500 Index and Dow Jones Index) were only one step away from their all-time highs. Tom Lee, co-founder and head of research at Fundstrat, a financial market research institution known as the “magic operator of Wall Street,” said investors should not deviate from assets that have risen so far in 2024. Tom Lee said that what plays a role in the stock market are stocks related to artificial intelligence — such as Nvidia (NVDA.US), and stocks highly related to artificial intelligence — such as ultra-microcomputers (SMCI.US). He added that weight-loss related deals, namely pharmaceutical companies that produce weight loss drugs, are also doing well. Tom Lee added that the industrial sector (XLI) and financial sector (XLF) performed well, as did cryptocurrencies such as Bitcoin.

Financial easing has made it difficult to cut interest rates: the Federal Reserve faces a paradox of policy reversal. Apollo chief economist Torsten Sløk said that the Federal Reserve has persuaded the financial market to create a more relaxed environment, which in turn has made the task of cutting interest rates more difficult. Bloomberg's US Financial Condition Index shows that compared with when the Federal Reserve began raising interest rates in March 2022, the current credit availability and costs in the currency, bond, and stock markets are clearly more favorable. This is due to the Fed's policy shift in November last year. At the time, Powell hinted that inflation had cooled down enough to stop raising interest rates and began considering when to start cutting interest rates. Wall Street misinterpreted this statement, believing that the Federal Reserve will soon introduce an easing policy and that interest rates will be cut as many as six times in 2024, triggering a sharp rebound in the stock market. Sløk estimates that the S&P 500 has increased its market capitalization by $9 trillion since then, and compared this to $19 trillion in consumer spending last year.

Individual stock news

MEME stocks once again skyrocketed, and GME.US (GME.US) rose more than 90% before the market. After retail “leading brother” Keith Gill showed that his portfolio held a large amount of GameStop common stock and call options, GameStop's US stocks rose more than 90% before the market on Monday. Jill's username on Reddit is DeepF... value, and his username on YouTube and X is Roaring Kitty. He reappeared last Sunday night and posted a screenshot showing that his portfolio holds a large amount of GameStop common stock and call options. According to an account snapshot posted on the Reddit R/Superstonk forum, as of Friday's closing price, Jill held 5 million GameStop shares worth $115.7 million. The account also shows that it holds 120,000 GameStop call options at an exercise price of $20, expiring on June 21, and the purchase price of each option is approximately $5.68.

AMD (AMD.US) is fully sprinting into AI data centers and AIPC! Major launch of MI325x and Ryzen AI 300 series. AMD, the leader of AI chips, is speeding up the launch of new server AI chips and end-side AI chips for the AI PC side, in an attempt to weaken Nvidia's absolute dominance of the lucrative server AI chip market of up to 90%, while also gaining a first-mover advantage over its chip peers in the end-side AI market. In addition, AMD's more advanced MI350 series will be launched in 2025, while MI400 series will be launched a year later. AMD's annual release cycle is in line with the annual plan proposed by Nvidia CEO Jensen Huang (Jensen Huang) during his speech in Taipei the night before.

The judge ruled that the Zantac cancer lawsuit continued, and GlaxoSmithKline (GSK.US) plummeted 10% before the market. A Delaware judge handed down an important ruling, approving the continuation of more than 70,000 lawsuits against GlaxoSmithKline and the heartburn medication Zantac it produces, alleging that the drug may cause cancer. The decision dealt a major blow to GlaxoSmithKline, whose stock price plummeted 10% before the market on Monday, the biggest drop since mid-2022. The discovery triggered a global recall of Zantac and led to a significant evaporation in the market value of several pharmaceutical companies, including GlaxoSmithKline. Investors are concerned that this lawsuit may place a significant financial burden on the relevant pharmaceutical companies. In response, Judge Vivian Medinilla ruled that GlaxoSmithKline, Pfizer (PFE.US), Sanofi (SNY.US), and other pharmaceutical companies must face lawsuits relating to Zantac.

CEO of Nvidia (NVDA.US): Blackwell chips have been put into production, and the next-generation AI platform Rubin will be launched in 2026. Nvidia CEO Huang Renxun said in his keynote speech at the 2024 Chinese Taipei International Computer Show that Blackwell chips are now in production. He also said that the company plans to upgrade its artificial intelligence accelerator every year and announced that it will launch the Blackwell Ultra AI chip in 2025 and the next-generation AI platform called “Rubin” in 2026, which will use HBM4 memory. According to reports, Nvidia's first Blackwell chip is named GB200, which claims to be the “most powerful chip in the world” at present. Currently, the supply chain has high expectations for the GB200. It is estimated that in 2025, the shipment volume may exceed one million units, which will account for nearly 40% to 50% of Nvidia's high-end GPU shipments.

Key economic data and event forecasts

21:45 Beijing time: The final value of the US S&P global manufacturing PMI for May.

22:00 Beijing time: US ISM manufacturing PMI for May, US monthly construction expenditure rate for April.

Performance Forecast

Tuesday pre-market: TOUR.US