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Last week, Elon Musk called Bloomberg's "SpaceX Said to Cut IPO Value" story "false," marking the latest clash between Musk and the MSM over coverage of his companies.

Reuters has released a new report, which, based on sources, says SpaceX is planning an IPO at a price of $135 per share, aiming to raise a record $75 billion by selling about 555.6 million shares at an estimated $1.75 trillion valuation.

SpaceX's roadshow is expected to begin Thursday, with a potential Nasdaq debut under the ticker SPCX on June 12. Goldman Sachs, Morgan Stanley, BofA, Citigroup, and JPMorgan are leading the deal.

Sources said the IPO is "structured as an all-primary offering," which means the proceeds will go to SpaceX rather than existing shareholders. Musk will reportedly be subject to a 366-day lock-up period.

At a $1.75 trillion valuation and projected 2025 booking revenue of $18.67 billion, SpaceX would trade at roughly 94 times trailing sales. The company also reported a $4.94 billion net loss in 2025, compared with a prior-year profit, with Starlink internet as the major profit engine.

Beyond Reuters' reporting, there was a separate report from Morningstar analysts stating that SpaceX's valuation should be less than half of the $1.75 trillion figure, and closer to $780 billion.

Morningstar equity analyst Nicolas Owens wrote in a note that his team "doesn't see Grok as one of the leading AI labs today," adding:

"We think the company has been significantly overvalued and investors will have opportunities to buy the stock at more attractive levels after the IPO."

Polymarket odds for "SpaceX IPO closing market cap above ___ ?" currently stand at 89% for a market cap above $1.8 trillion.

Related:

• SpaceX IPO Update: New Filing Reveals Friends & Family Share Allocation, Anthropic AI Deal, And Water Risk

SpaceX is preparing a record-setting IPO that would test public-market appetite for Musk's empire, space, and AI. This listing is expected to pave the way for other mega IPOs, such as those of chatbot makers OpenAI and Anthropic.

Via Remix News,

The family of Vickrum Digwa has been accused of adding insult to injury after issuing a statement asking that Henry Nowak’s murder not be used to cause “further pain,” despite fierce public anger over the way the 18-year-old was stabbed, falsely accused, handcuffed and left dying in the street.

Vickrum Digwa was sentenced to life in prison with a minimum term of 21 years on Monday after stabbing 18-year-old Henry Nowak multiple times in Southampton. According to the account provided, Henry was stabbed five times, including twice in the back of the legs, once in the face and once fatally in the chest.

The case has caused national outrage not only because of the killing itself, but the wider context. After the stabbing, Digwa’s brother phoned police and claimed that “some White guy” had racially insulted his brother. Henry had not done so, a court ruled. Instead, Digwa had used a ceremonial knife to stab him repeatedly.

Police then arrested Henry purely on the basis of the report of racial assault against him. Bodycam footage released by the Crown Prosecution Service after the sentencing showed Henry lying motionless on the ground while being arrested on suspicion of assault. He told officers he had been stabbed and could not breathe.

???? The distressing bodycam footage of Henry Nowak's final minutes has been released by the Crown Prosecution Service.

Henry was stabbed by Vickrum Digwa, with an 8-inch blade he said he carried as part of his Sikh faith, while walking home alone in December last year in… pic.twitter.com/mIM1BgGdkj

— Remix News & Views (@RMXnews) June 1, 2026

“I don’t think you have, mate,” one officer replied.

Henry died minutes later.

Against that background, the Digwa family’s statement has been met with disbelief. The statement said, “The loss of a young life is a grief that no family should ever have to carry. We are deeply sorry for the pain and suffering the Nowak family has had to endure.”

“We love Vickrum. We will continue to love him. That love does not stand in opposition to the sorrow we feel for the Nowak family. Both are real, and both will remain with us for the rest of our lives.”

But the line that has drawn particular anger came later, when the family said: “We would give anything to turn back time so the path of both Henry and Vickrum never crossed that night. We cannot change what has happened; we just hope that no further pain is caused in its name.”

Rather than calling an ambulance, Digwa filmed Henry. The murder weapon was given to his mother, and police later found it at the family home along with more than 20 other weapons. His mother is due to be sentenced for removing the murder weapon from the crime scene.

“We ask that this tragedy is not used by anyone to inflame division or hostility towards any community. We now ask for privacy as we come to terms with what lies ahead,” the family added.

The Digwa family ask for privacy so they can ‘come to terms with what lies ahead’. F*** off. They didn’t call an ambulance, they lied to police, they played the race card, they also raised a monster. They get to visit their son in prison, the Nowaks will never see their son again pic.twitter.com/2QG7sHsEs6

— Patrick Christys (@PatrickChristys) June 2, 2026

GB News anchor Patrick Christys wrote in response, “F*** off. They didn’t call an ambulance, they lied to police, they played the race card, they also raised a monster. They get to visit their son in prison, the Nowaks will never see their son again.”

Political commentator Connor Tomlinson wrote, “The Digwa family aren’t sorry. They just wish they hadn’t been caught.”

“Note that they laundered this face-saving statement through a ‘Sikh Press Association’ account,” he added. “I can’t name a white advocacy organisation that would publish a statement from a family who conspired to cover up a murder.”

GB News presenter Michelle Dewberry said she had heard what members of the Digwa contingent had said and done in court towards the Nowak family.

“It didn’t sound like the behavior of people who are ‘deeply sorry’ to me,” she wrote.

Dewberry was referencing the conduct of the Digwa family at the court during Monday’s sentencing hearing, in which they continued to claim they were being racially discriminated against.

Presenter Dan Wootton also condemned the statement, writing.

“This is a revolting and reprehensible statement from Henry Nowak murderer Digwa’s family.”

The conduct of Digwa’s relatives is now under wider scrutiny. Reform UK MP Robert Jenrick, a former Conservative Home Office minister, asked why Digwa’s brother and father had not yet been charged.

I hope Hampshire Police and the CPS have a good explanation as to why Digwa’s brother and father have not yet been charged.

His mother is being sentenced soon for removing the murder weapon from the crime scene.

If his brother and father knew Henry had been stabbed, are they…

— Robert Jenrick (@RobertJenrick) June 2, 2026

“I hope Hampshire Police and the CPS have a good explanation as to why Digwa’s brother and father have not yet been charged,” he wrote.

“His mother is being sentenced soon for removing the murder weapon from the crime scene. If his brother and father knew Henry had been stabbed, are they not accessories too?

“The brother called 999 to falsely report Henry for racially attacking the murderer. The father physically detained a dying Henry until the police arrived. None of them informed the police that Henry had been stabbed. All watched him die, handcuffed, on the ground,” he added.

Henry’s family issued statements outside court after the sentencing. They described his treatment by police as “inhumane and degrading.” His father said Henry “did not die with dignity.” His sister, Olivia Nowak, said, “The day we got the knock on the door to say my brother had passed, I don’t think there are any words to describe that type of pain. A lot of myself died when he died.

“Henry was the most wonderful, funny, handsome, kind, precious, smart boy. He lit every room he walked in,” she added.

The fear of being called racist was greater than dealing with Henry Nowak’s murder.

We should respond to this with pure cold rage.

Britain’s historic way of life is being thrown away. pic.twitter.com/4N6vL76q1F

— Nigel Farage MP (@Nigel_Farage) June 2, 2026

On Tuesday, Reform UK leader Nigel Farage said people should respond to Henry Nowak’s death with “pure cold rage,” calling it evidence of a “two-tier culture.”

Restore Britain leader Rupert Lowe said Digwa should face the death penalty. “A Restore Britain Government, with the British people’s approval, would put Vickrum Digwa to death,” he wrote. “Henry Nowak was stabbed by Digwa five times, including twice in the back of his legs, once in the face, and a fatal wound to the chest.”

Enough is enough - a deep line needs to be drawn in the sand. Talk is weak. Britain needs to say no more, and mean it.

A Restore Britain Government, with the British people's approval, would put Vickrum Digwa to death.

Henry Nowak was stabbed by Digwa five times, including… pic.twitter.com/GXFp8WnmFA

— Rupert Lowe MP (@RupertLowe10) June 2, 2026

“Rather than calling an ambulance, Digwa filmed Henry. Digwa gave the knife to his mother and it was found by police at their home along with more than 20 other weapons. Keeping this savage alive serves nobody,” he added.

Lowe also said the police officers at the scene “who allowed Henry to die” would face criminal charges for gross negligence manslaughter under a Restore Britain government, and that “Digwa’s foreign family will be deported.”

Read more here...

Kuwait International Airport has come under Iranian missile and drone attack on Wednesday, in a significant strike that killed one person and left 63 people injured - according to the country's health ministry, with several of the victims being seriously wounded.

A passenger terminal was directly struck, damaging facilities including diplomatic missions at the airport, Kuwaiti authorities have said. Area hospitals conducted seven major emergency surgeries following the incident, underscoring that it was a mass casualty event.

Kuwaiti defense ministry spokesperson Brig Gen Saud Abdulaziz Al-Atwan described the attack as "criminal Iranian aggression which resulted in significant material damage to the building and injuries." It confirmed engaging 13 missiles and 17 drones total which were fired from Iran. 

Civil aviation authorities immediately suspended traffic and transferred arriving flights to separate unaffected airports after "terminal one came under Iranian attacks causing casualties and damage."

The cross-border airport attack came after violent exchanges of fire between the US and Iran, which at first looked like limited one-off incidents, but then became an extended tit-for-tat.

Overnight, the US military deployed a Hellfire missile to disable a tanker attempting to bypass the American blockade in the Strait of Hormuz. Following the intercept, American forces engaged in a wider kinetic exchange, stating they repelled subsequent Iranian reprisal strikes across the region and launched retaliatory attacks against military sites on Iran’s Qeshm Island.

In response, Iran’s Islamic Revolutionary Guards Corps (IRGC) claimed it launched a missile and drone barrage targeting the U.S. Fifth Fleet headquarters in Bahrain - an assertion that Central Command (CENTCOM) has explicitly denied. The IRGC had also sent several missiles on two US bases in Kuwait, which were said to have been intercepted.

Serous damage and chaos at Kuwait International Airport:

??#UPDATE Iran bombs Kuwait International Airport pic.twitter.com/beTFw6Lyuv

— War Monitor (@WarMonitors) June 3, 2026

The Gulf Cooperation Council has in response slammed Iran for their "ongoing aggression" against member states Bahrain and Kuwait, denouncing the "cowardly attacks on civilian objects" which mark a "dangerous and unprecedented escalation."

But Tehran is not backing down and is instead issuing further hardline warnings and threats, per Al Jazeera citing state media:

Iran’s Revolutionary Guard says retaliatory strikes "should serve as a lesson" for the United States after it fired a barrage of missiles and drones at Kuwait and Bahrain.

While Iran's foreign ministry is warning that the overnight US assault on Qeshm Island continues a severe breach of the ceasefire, President Trump is saying that "conversations between us have been going on continuously" - in reference to the Iranians.

Kuwait's civil aviation authority confirmed Iranian drones and missiles hit the T1 terminal at Kuwait International Airport. Several people were injured and the building sustained severe damage. Commercial flights have been halted. https://t.co/fbFhjSofIY pic.twitter.com/zOz83Ba6cy

— Open Source Intel (@Osint613) June 3, 2026

*  *  *

More latest developments via Newsquawk...

• Explosions were heard near Qeshm Island in Iran on Wednesday morning.
• Kuwait's Army announced its air defences were intercepting hostile missile and drone attacks, while reports noted that two US bases were targeted in Kuwait, with explosions in the Ali al-Salem and Arifjan bases where US soldiers are stationed. Furthermore, air raid sirens sounded in the UAE and Saudi Arabia, with explosions also reported in Saudi Arabia, while explosions were heard in Qamishli, Syria, and earlier reports noted multiple explosions in the centre of Iraqi Kurdistan with the headquarters of anti-Iranian separatist groups targeted.
• IRGC said the US attacked Qeshm Island, and in response, Iran carried out precise and intensive missile strikes on US bases in Kuwait, while it warned further US aggression will be met with a seismic, crushing and decisive response.
• IRGC said the headquarters of the US 5th Fleet in Bahrain was attacked by missiles and drones from the IRGC Aerospace Force, while it targeted a US-affiliated vessel named Panaya with missiles and clarified the recent attack was in retaliation for the US targeting an IRGC communications tower in the south of Qeshm Island.
• US CENTCOM said Iran launched several ballistic missiles towards neighbours and that forces successfully defeated multiple Iranian missiles, while US forces had conducted strikes on Qeshm Island in response to attempted attacks by Iran. CENTCOM stated that forces shot down three one-way attack drones launched by Iran toward civilian mariners that were rightfully transiting regional waters, and US forces also conducted self-defence strikes on an Iranian military ground control station on Qeshm Island. Furthermore, it denied IRGC claims that Iran struck the 5th Fleet HQ in Bahrain and a US airbase in the region, and stated that all Iranian attacks on US forces failed.
• US CENTCOM says forces disabled a Botswana-flagged unladen oil tanker that was attempting to sail toward an Iranian port on the Arabian Gulf on June 2nd. Says: US aircraft disabled the vessel by firing a Hellfire missile into the ship’s engine room, preventing the tanker from reaching Iran.
• US President Trump is pushing Iran to make firmer nuclear commitments and wants nuclear concessions in writing from Iran, according to ABC News.
• US Secretary of State Rubio said that Iran has mined large segments of the Hormuz Strait. Rubio stated that nuclear negotiations with Iran were highly complicated and technical, which would therefore take time, while he added that the war with Iran had made interactions with Tehran more complicated, but also commented that the "war in Iran is over".
• Iran's Foreign Ministry condemned the US attacks on Iranian tanker and Qeshm island. The Foreign Ministry "notes the direct and clear responsibility of the rulers of Kuwait and Bahrain for last night’s aggressive acts."
• Hardline Iranian lawmaker called for stronger military response to US strikes, Al Jazeera reported.
• Kuwait’s General Civil Aviation Authority said an emergency plan at Kuwait International Airport was activated after Terminal 1 was targeted by Iranian drones and missiles.
• Hezbollah attacked an Israeli command post in southern Lebanon with a drone strike, which wounded eight Israeli soldiers, according to SNN.

US equity futures are mixed as oil prices, bond yields, and USD move higher in response to the latest overnight attacks in the Middle East with no public progress on a deal. As reported previously, the US struck Iran’s Qeshm Island, which was then met with retaliatory Iranian strikes on US bases in Kuwait; explosions were also reported in Saudi Arabia, and air sirens were set off in the UAE. US Centcom said that the Iranian drone attacks were “successfully defeated.” As of 8:00am ET, S&P futures were down 0.1% but off session lows: absent the now daily gamma squeeze, the S&P is poised to halt a nine-day rally; Nasdaq futures rose 0.2% with semis bid premarket led by MRVL, INTC, AVGO, and AMD as Mag7 names are weaker. Some pockets of tech exuberance are seen in the US pre-market with Marvell adding 12% to Tuesday’s near 33% surge. Tech enthusiasm was once again on display in Asia with the MSCI APAC index hitting yet another record high. Mag7 have been used as a funding trade to buy Semis and to make room for deals, according to JPM. Cyclicals ex-Energy are lagging Defensives. Brent rose 2.3% to top $98 a barrel. The yield on 10-year Treasuries climbed four basis points to 4.48% as crude prices stoked concerns about inflationary pressures; the yield curve is bear flattening with yields up 3-4bp as USD is poised for its strongest week since mid-May.  Data calendar includes May ADP employment change (8:15am), S&P Global US services PMI (9:45am), and April factory orders and May ISM services index (10am). Fed speaker slate includes Barr (9am) and Logan (4pm), and Beige Book is slated for 2pm release.

In premarket trading, Magnificent Seven are mixed (Meta +0.6%, Apple -0.2%, Alphabet -0.7%, Amazon -0.05%, Nvidia +0.3%, Microsoft +0.2%, Tesla -0.7%)

• Cognyte Software (CGNT) slumps 21% after the Israeli company posted disappointing first quarter earnings.
• GameStop (GME) is up 13% after the video game retailer reported net sales for the first quarter of $835.3 million, marking a 14% increase from the year prior. The company also said its board approved a discretionary $2 billion share repurchase authorization.
• Iren Ltd. shares rise in premarket trading after it signed a transmission connection agreement to support a planned 800-megawatt data center campus in Bundey, South Australia.
• Macy’s (M) climbs 3% after the department-store operator boosted its adjusted earnings per share forecast for the full year.
• Marvell Technology (MRVL) gains 10%, putting the stock on track to extend Tuesday’s 33% rally, after Nvidia CEO Jensen Huang predicted that the semiconductor and networking company would be the next business to hit a $1 trillion valuation.
• Medtronic (MDT) rises 2% after posting fourth quarter revenue that beat expectations.
• Palo Alto Networks (PANW) falls 2% after the security software company reported results following a 61% year-to-date rally.
• Sherwin-Williams (SHW) climbs 3% after the company and Nippon Paint abandoned efforts to acquire the Dutch paintmaker Akzo Nobel.
• Sprinklr (CXM) falls 3% after the software company trimmed its full-year revenue outlook.

In other news, SpaceX plans to set the terms of its IPO offering as early as Wednesday afternoon, ahead of what’s expected to be the biggest ever listing. Reuters later reported that SpaceX aims to sell 555.6 million shares ?at $135 apiece. Uber set usage caps on some AI-powered tools used by its staff. The move, meant to manage costs after the company blew through its AI budget, may be a concern for investors tracking the explosive growth in the industry. GitLab is cutting about 14% of its workforce and exiting 22 countries as part of a restructuring aimed at streamlining operations and sharpening execution. Google must make changes to its AI-generated search summaries after the UK’s antitrust watchdog ordered it to give publishers more control over how their content is used.

US stocks struggled to build on record gains as growing strains on the ceasefire between the US and Iran sent oil prices higher for a third straight day and lifted bond yields. The cautious mood in markets follows flare-ups in the Middle East that are testing a fragile truce between Washington and Tehran, with US forces intercepting ballistic missiles and drones aimed at neighboring countries and striking an Iranian command center in response. 

The mitigating factor is higher SoH throughput; According to JPM EM Strategy, energy export volume have risen to ~3.6mm bpd over the last 2 days with the 7dma ~2.5mm bpd and refined chemical throughput now >50% of pre-conflict levels. The OECD flags global growth downside risk from a prolonged US / Iran Conflict while hiking its inflation estimates.

Trump said the US was continuing to work with Iran on a deal. Tehran has agreed it won’t have a nuclear weapon and the parties’ leaders “probably will meet at some point,” Trump said. Traders are watching whether the S&P 500 can extend its winning streak to the longest in more than three decades. A narrow rally has seen technology stocks, and chipmakers in particular, leave the rest of the market far behind.
“I don’t think this is the top, there’s still room to run,” said Amanda Lyons, head of research at Energy Group Capital. “The fuel is just quietly shifting from earnings to excitement; that’s fine on the way up, it only matters when the music stops.”

The S&P 500 may have just matched its best winning streak since 1995, but that run included five days in a row when decliners outnumbered advancers. The pattern, which was snapped on Tuesday, is described as a “breadth paradox,” by BTIG technician Jonathan Krinsky. Yet over the past three years, periods of weak breadth failed to alter the overall picture, Bloomberg notes. 

Investors are also awaiting SpaceX’s disclosure of the terms of its initial public offering that is set to be by far the largest in history. Reuters reported that Elon Musk’s rocket launch, satellite and AI company aims to sell more than 550 million shares at $135 apiece for a $75 billion IPO.  The share sale forms part of a pipeline of potential offerings from high-profile tech companies in the coming months. AI rivals OpenAI and Anthropic PBC look to forge ahead with listings of their own, while Alphabet Inc. revealed plans for a record $80 billion equity offering on Monday.

“The IPO wave is a strong confidence indicator for markets,” said Nataliia Lipikhina, head of EMEA equity strategy at JPMorgan Private Bank. “We think there is enough capacity in the market to absorb them, and the renewed issuance pipeline is additive to the broader market story.”

Private credit is back in focus, with Partners Group limiting withdrawals at one of its evergreen private equity funds amid heightened redemption pressure. It’s a sign the investor anxiety that hit private credit vehicles may be spilling over to asset classes within private markets. It follows Cliffwater’s flagship private credit fund capping redemptions at 5% in the second quarter after investors looked to pull about 17% of shares.

In political news, Republican Steve Hilton and Democrat Xavier Becerra surged to the top of California’s crowded gubernatorial primary. Meanwhile, the US is proposing tariffs of 10% on imports from the EU as Trump looks to rebuild the tariff wall struck down by the US Supreme Court. China, India, Japan, South Korea, Brazil and Switzerland would be subject to a 12.5% levy. Fed Chair Kevin Warsh is said to have hired conservative policy analysts Paul Winfree and Daniel Heil as temporary advisers. 

Bitcoin’s selloff extended into Wednesday after Strategy’s sale of a tiny portion of its massive cryptocurrency stockpile rattled sentiment and widened the token’s divergence from record-setting technology shares. 

Turning to earnings, Broadcom will offer investors another snapshot into AI spending when it reports after the close, with Bloomberg Intelligence expecting accelerating revenue from XPU chips and growing demand for networking.

European equities continue to lag global peers with the Stoxx 600 down 0.4% as higher energy prices weigh on sentiment. Here are the biggest movers Wednesday:

• Inditex shares advanced 5.6%, the third-best performance on the Stoxx 600 Retail Index, after the Zara owner reported earnings that analyst calls “reassuring,” while a strong start to 2Q has been aided by calendar effects
• B&M shares rose as much as 16%, the largest intraday gain on record, after the discount retailer reported earnings that beat consensus expectations
• Boohoo shares rose as much as 16%, trading at a 12-week high, after the online retailer returned to growth following a rise in gross merchandise value in the first quarter, with much stronger growth delivered in May
• Douglas gained as much as 7.9%, the most since Aug. 2025, as Berenberg initiates the stock with a buy rating, saying the German beauty retailer offers a compelling risk-reward based on its single-digit adjusted P/E valuation and double-digit free cash flow yields
• Sodexo shares gained as much as 3.6% to trade at a seven-month high after Barclays lifted its price target by almost 10% and said upcoming third-quarter results can provide a positive short-term catalyst for the food services company
• Howden Joinery Group’s shares rose as much as 5.2%, the most in almost two months, after it agreed to acquire the parent company of Ultima Furniture Systems, which trades as DIY Kitchens, for an enterprise value of £390 million
• Akzo Nobel shares fell as much as 22%, their steepest drop on record, after Nippon Paint and Sherwin-Williams abandoned efforts to acquire the Dutch paintmaker
• Partners Group fell as much as 13% to the lowest in more than six years as the alternative investment manager caps withdrawals from one of its evergreen private equity funds amid heightened redemption pressure
• Norwegian Air shares slide as much as 9%, the most in over a year, after Danske Bank cut its recommendation on the airline to sell from hold, saying proprietary fare data indicate demand for its routes is weaker than expected
• Clas Ohlson fell as much as 11%, the most since December, after the Swedish home improvement retailer reported its latest earnings and presented new financial targets
• DiscoverIE shares fell as much as 7% after earnings broadly met expectations but failed to extend a rally that had lifted the electronics manufacturer more than 50% over the past two months
• Ninety One fell as much as 8.2% in London, to its lowest intraday level since April after the asset management firm reported net flows for the full year that missed the average analyst estimate

Asian stocks rose to yet another record, with Japan leading gains as optimism over the region’s growing role in the artificial-intelligence ecosystem boosted tech shares. The MSCI Asia Pacific Index climbed as much as 0.9%, heading for a fourth day of gains. Japan’s Nikkei also surged to an all-time high as investors piled into chip and technology shares following a surge in US equities. Taiwan’s benchmark was the second-biggest gainer in the region. Markets in South Korea and Thailand were shut for a public holiday. Meanwhile, Indonesian stocks were the biggest losers as oil prices extended their advance to a third day. The Jakarta Composite Index plunged to its lowest level in five years and the rupiah hit a record low in another stark reminder of the multi-faceted challenges confronting Southeast Asia’s biggest economy. Investors who continue to buy into the AI trade are increasingly bullish on the region, with several Asian semiconductor shares rising. In particular, Japan’s AI industry is offering renewed appeal due to its lower cyclical risk compared with Taiwan’s and South Korea’s markets, according to Barclays Plc.

“Korea is a memory trade. Taiwan is a foundry trade. Japan is an economy trade, with an AI kicker,” Barclays global chairman of research Ajay Rajadhyaksha wrote in a note. “That distinction matters enormously if the memory cycle turns.”

In FX, USD/JPY touched 160 before remarks from PM Takaichi briefly guided the pair lower. Subsequent comments from BOJ Governor failed to support the yen.

In rates, treasury futures sit near day’s lows into the early US session amid deeper losses in European bonds as rising oil prices put upside pressure on yields globally. Oil is higher for a third straight day as strikes between the US and Iran cloud outlook for a peace agreement. US yields are 3bp-4bp higher on the day with curve spreads little changed; 10-year is near 4.48%, 3.5bp cheaper with bunds and gilts in the sector lagging by an additional 0.5bp and 1bp. US session includes ADP employment change and ISM services index, both for May, and April factory orders. 

In commodities, brent crude is up 2.6% near session highs, and on a $98/bbl handle amid a lack of a breakthrough in US-Iran negotiations and Iran launching missile and drone strikes at multiple US sites. Spot gold and silver are on the backfoot, with respective losses of 1% and 1.2%.Bitcoin is off its worst levels but has extended its recent slide, down 1.2%.

US economic data calendar includes May ADP employment change (8:15am), S&P Global US services PMI (9:45am), and April factory orders and May ISM services index (10am). Fed speaker slate includes Barr (9am) and Logan (4pm), and Beige Book is slated for 2pm release.

Market Snapshot

Top Overnight News

• Iran launched missiles at Kuwait — where one person was killed, according to the country’s foreign ministry — and Bahrain, as the US conducted new strikes on Qeshm Island. These came after the US military said it struck an oil tanker heading for an Iranian port. President Donald Trump has ruled out the prospect of “boots on the ground now.” CNN
• Trump said he swore at Benjamin Netanyahu in a call this week as the president tried to deescalate fighting in Lebanon and keep peace talks with Iran on track. The president also said in an interview on the Pod Force One podcast that Iran has agreed it won’t have a nuclear weapon. BBG
• Donald Trump is moving to rebuild his tariff wall, with the US proposing duties of at least 10% on imports from major trading partners including the EU, Canada and Mexico following a forced-labor probe. Products from China, Japan, Brazil and several other economies would face a higher 12.5% rate. BBG
• Even as the piles of capital secured have grown ever larger, the ability to deploy it in the artificial intelligence race has become less certain. Supply-chain backlogs, permitting fights and availability of power supplies are among the issues that have caused the construction of data centers to fall behind targeted timelines, with the gap growing wider in recent months. WSJ
• Nvidia’s Jensen Huang outlined the “insane” returns offered by AI during an address to wealthy family offices that sought to dispel lingering concerns around the big spending that’s accompanied the boom. BBG
• US Acting Attorney General Blanche confirmed the Trump administration is not moving forward with the weaponisation fund.
• US Senate Democrats are reportedly privately urging GOP leaders to pressure President Trump to withdraw his appointment of Pulte as acting director of national intelligence, threatening to tank a bipartisan FISA deal if Trump refuses: Punchbowl 
• Federal Reserve Chairman Kevin Warsh has tapped two outside associates (Paul Winfree and Daniel Heil) to advise him while he settles into the job, one of whom previously helped write a conservative blueprint that recommended a radical restructuring of the central bank. WSJ
• Federal Reserve watchers expect Kevin Warsh to begin revamping the central bank’s rate guidance as soon as this month, as the newly appointed chair embarks on a sweeping overhaul of the institution. Several former top officials said that they expected Warsh, whom President Donald Trump swore in to succeed Jay Powell as Fed chair in May, to begin rolling back the central bank’s “forward guidance” on interest rates as soon as the mid-June Federal Open Market Committee meeting. FT
• China’s services activity jumped in May, according to a private survey, a positive sign amid still weak consumer sentiment as price shocks from the conflict in the Middle East ripple through economies. The RatingDog China services purchasing managers’ index rose to 54.4 from 52.6 in April. BBG
• India is considering tax cuts for foreign bond investors to attract more overseas capital, people familiar said. The cabinet is expected to today weigh a significant reduction in taxes paid by global funds on Indian debt, including eliminating or cutting the current 20% levy on interest income. BBG

Iran War News

• Explosions were heard near Qeshm Island in Iran on Wednesday morning.
• Kuwait's Army announced its air defences were intercepting hostile missile and drone attacks, while reports noted that two US bases were targeted in Kuwait, with explosions in the Ali al-Salem and Arifjan bases where US soldiers are stationed. Furthermore, air raid sirens sounded in the UAE and Saudi Arabia, with explosions also reported in Saudi Arabia, while explosions were heard in Qamishli, Syria, and earlier reports noted multiple explosions in the centre of Iraqi Kurdistan with the headquarters of anti-Iranian separatist groups targeted.
• IRGC said the US attacked Qeshm Island, and in response, Iran carried out precise and intensive missile strikes on US bases in Kuwait, while it warned further US aggression will be met with a seismic, crushing and decisive response.
• IRGC said the headquarters of the US 5th Fleet in Bahrain was attacked by missiles and drones from the IRGC Aerospace Force, while it targeted a US-affiliated vessel named Panaya with missiles and clarified the recent attack was in retaliation for the US targeting an IRGC communications tower in the south of Qeshm Island.
• US CENTCOM said Iran launched several ballistic missiles towards neighbours and that forces successfully defeated multiple Iranian missiles, while US forces had conducted strikes on Qeshm Island in response to attempted attacks by Iran. CENTCOM stated that forces shot down three one-way attack drones launched by Iran toward civilian mariners that were rightfully transiting regional waters, and US forces also conducted self-defence strikes on an Iranian military ground control station on Qeshm Island. Furthermore, it denied IRGC claims that Iran struck the 5th Fleet HQ in Bahrain and a US airbase in the region, and stated that all Iranian attacks on US forces failed.
• US CENTCOM says forces disabled a Botswana-flagged unladen oil tanker that was attempting to sail toward an Iranian port on the Arabian Gulf on June 2nd. Says: US aircraft disabled the vessel by firing a Hellfire missile into the ship’s engine room, preventing the tanker from reaching Iran.
• US President Trump is pushing Iran to make firmer nuclear commitments and wants nuclear concessions in writing from Iran, according to ABC News.
• US Secretary of State Rubio said that Iran has mined large segments of the Hormuz Strait. Rubio stated that nuclear negotiations with Iran were highly complicated and technical, which would therefore take time, while he added that the war with Iran had made interactions with Tehran more complicated, but also commented that the "war in Iran is over".
• Iran's Foreign Ministry condemned the US attacks on Iranian tanker and Qeshm island. The Foreign Ministry "notes the direct and clear responsibility of the rulers of Kuwait and Bahrain for last night’s aggressive acts."
• Hardline Iranian lawmaker called for stronger military response to US strikes, Al Jazeera reported.
• Kuwait’s General Civil Aviation Authority said an emergency plan at Kuwait International Airport was activated after Terminal 1 was targeted by Iranian drones and missiles.
• Hezbollah attacked an Israeli command post in southern Lebanon with a drone strike, which wounded eight Israeli soldiers, according to SNN.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks mostly gained as the region took its cue from Wall St, where the S&P 500, Dow and Nasdaq 100 printed fresh record highs, which has helped regional bourses shrug off the geopolitical escalation, in which the US struck Qeshm Island, and Iran targeted US bases in neighbouring countries. ASX 200 was led by outperformance in materials, mining and resources sectors, but with gains capped as tech, telecoms and defensives lagged, while participants also digested weaker-than-expected GDP data. Nikkei 225 took inspiration from US peers and printed a fresh all-time high after climbing above 68,000 for the first time. Hang Seng and Shanghai Comp were mixed, with the Hong Kong benchmark dragged lower by profit-taking following recent earnings and mixed fortunes among the key tech stocks, while the mainland found support from the better-than-expected Chinese RatingDog Services PMI data.

Top Asian News

• Japanese PM Takaichi said FX policy is important to support the economy and trades including speculation have a big impact on markets. She further stated that they are prepared to take appropriate measures in the FX market at any time if needed while deepening international cooperation, including with the US, on FX.
• Japanese Finance Minister Katayama said they are prepared to respond appropriately on forex as needed, while she won't comment on specific FX levels.

European bourses (STOXX 600 -0.4%) start Wednesday's session with modest losses due to the introduction of new levies on US imports related to its 301 investigations. A 10% tariff has been applied to imports from Canada, Mexico, the EU, Taiwan and the UK, while some countries, including China and Japan, have received a higher 12.5% levy. European sectors highlight a negative bias. Financial Services (-1.7%) and Autos (-1.6%) are the laggards, with Chemicals (-1.1%) rounding out the bottom three. At the top end lies Retail (+1.8%), the sole sector printing decent gains, helped by gains in Inditex (+3.9%) after the Co. reported Q1 earnings that came in line with expectations, while sales in May rose 11.5%.

Top European News

• UK S&P Global Composite PMI Final (May) 49.7 vs. Exp. 48.5 (Prev. 52.6).
• UK S&P Global Services PMI Final (May) 49.3 vs. Exp. 47.9 (Prev. 52.7).
• EU S&P Global Composite PMI Final (May) 48.5 vs. Exp. 47.5 (Prev. 48.8).
• EU S&P Global Services PMI Final (May) 47.7 vs. Exp. 46.4 (Prev. 47.6).
• German S&P Global Composite PMI Final (May) 48.8 vs. Exp. 48.6 (Prev. 48.4).
• German S&P Global Services PMI Final (May) 48.1 vs. Exp. 47.8 (Prev. 46.9).
• French S&P Global Composite PMI Final (May) 44.9 vs. Exp. 43.5 (Prev. 47.6).
• French S&P Global Services PMI Final (May) 44.3 vs. Exp. 42.9 (Prev. 46.5).
• Italian S&P Global Composite PMI (May) 50.4 (Prev. 50.5).
• Italian S&P Global Services PMI (May) 49.4 vs. Exp. 49.1 (Prev. 49.8).
• Spanish S&P Global Composite PMI (May) 50.2 (Prev. 48.7).
• Spanish S&P Global Services PMI (May) 50.1 vs. Exp. 48.

FX

• G10s are mostly lower against the Buck (DXY +0.1%) as flare-ups continue in the Middle East. Since the close on Tuesday, the US struck Iran’s Qeshm Island, which was then met with retaliatory Iranian strikes on US bases in Kuwait, and explosions were also reported in Saudi Arabia, and air sirens were set off in the UAE.
• The Dollar crept higher overnight in tandem with oil/yields, and now looks towards the 99.40 mark in DXY (session high 99.40). Tuesday saw firm JOLTS jobs data which rose to the highest level since May 2024. Today sees the release of ADP’s monthly employment figure, expected to rise to 110/120k depending on which consensus you look at.
• JPY is the best G10 performer after sharp strength seen among comments from Japanese PM Takaichi and BoJ Governor Ueda. At around 08:30 BST, Japanese PM Takaichi said: “prepared to take appropriate measures in the FX market”. USD/JPY moved sharply lower from 159.91 to a trough of 159.55 within three minutes. The move pared around 20 pips, then around an hour later, comments from BoJ Governor Ueda resumed Yen strength. Ueda said the “BoJ’s basic stance is to continue raising the policy rate”, helping the pair mark a fresh session low of 159.36, though ultimately proving fleeting and returning to pre-Ueda levels. USD/JPY -0.1% at 159.80, a moving target at the time of writing.
• Antipodeans are the worst G10 performers. Aussie fares a little better than the Bird despite soft growth data overnight, which contracted at a faster rate than anticipated on a quarterly basis. AUD/USD (-0.3%) immediately fell around 8 pips, pared the move, then resumed lower as the Buck picked up. AUD/NZD +0.3%.

Fixed Income

• Global fixed benchmarks are broadly lower as the complex takes leads from the strength in energy prices, after yet another US-Iran flare-up. In brief, the US struck Iran’s Qeshm Island, which was then met with retaliatory Iranian strikes on US bases in Kuwait; explosions were also reported in Saudi Arabia, and air sirens were set off in the UAE.
• USTs (-5+ ticks) are lower this morning and trade at the lower end of a 109-15+ to 109-24+ range. And unsurprisingly, yields are firmer across the curve, with mild outperformance in the short end. Much of the action recently has been dictated by geopolitical developments, but attention this week will turn back to domestic data. Thus far, ISM Manufacturing topped expectations, whilst Prices Paid slipped from the prior (though still remains elevated); on the jobs front, JOLTS Job Openings topped expectations. Both are factors which play into the hands of the hawkish members at the Fed. Attention today now shifts to ADP, ISM Services and then the NFP report to end the week.
• Bunds (-30 ticks) follow the bearish bias and hold towards the bottom end of a 125.64 to 126.03 range. Today saw the release of PMI Final metrics from various EZ countries, which were subject to very mild upward revisions. The EZ-wide figure remained in contractionary territory at 48.5; the inner report suggested that whilst the ECB may provide an insurance hike at the June meeting, it may find it hard to deliver more tightening if the economy continues to weaken.
• Gilts (-45 ticks) underperform vs peers, given their high sensitivity to rising energy prices; currently holding at the mid-point of a 87.74 to 87.90 range. Yields are firmer across the curve, but with mild outperformance in near-term yields. Some attention recently has been on comments made by BoE’s Greene in the prior session, where she stated that “the case for hiking rates grows as the conflict continues”. Markets assign a 92% chance of a hike in September, and fully priced in by November.

Commodities

• Energy prices have bounced back following the flare-up in the Middle East since yesterday’s European close. To briefly recap, Iran and the US reported strikes against each other's assets. US CENTCOM said Iran launched several ballistic missiles toward neighbouring countries, with the UAE, Saudi, and Kuwait among the targets. Kuwait’s General Civil Aviation Authority said an emergency plan at Kuwait International Airport was activated after Terminal 1 was targeted by Iranian drones and missiles. IRGC said the US attacked Qeshm Island and that Iran responded with precise and intensive missile strikes on US bases in Kuwait. IRGC warned that any further US aggression would be met with a seismic, crushing and decisive response. On negotiations, US President Trump said reports that US-Iran communications had stopped were false and that conversations had continued continuously, while US Secretary of State Rubio said nuclear negotiations are highly complicated and technical and will take time (Full recap available on the Newsquawk headline feed).
• WTI Jul and Brent Aug futures are on firmer footing and near highs, with upside seen this morning as European traders entered the market and shortly after the aforementioned Kuwait civilian infrastructure strike. The former resides in a USD 93.45-96.56/bbl range whilst the latter sits at the top of a USD 96.44-98.68/bbl range. Dutch TTF trades higher by almost 3.5% at the time of writing.
• Spot gold and silver trade softer in lockstep with the gains in crude and hence the USD as inflationary woes remain ripe. The former dipped under yesterday’s USD 4,463/oz low to trade towards the bottom of a USD 4,451-4,497/oz range, with Monday’s low at USD 4,448/oz. Spot silver fell below USD 75/oz to trade in a USD 74-75.33/oz range.
• Base metals are also across the board amid similar inflationary/stagflationary woes arising from elevated crude prices. 3M LME copper fell back under USD 14,000/t to trade in a USD 13,871.90- 14,025.13/t range.
• US Private Inventory Data (bbls): Crude -6.8mln (exp. -3.6mln), Distillates -0.2mln (exp. -0.6mln), Gasoline +3.5mln (exp. -0.1mln), Cushing -0.3mln.
• White House economic advisor Hassett commented that gasoline prices are expected to decrease as the US receives additional oil supplies from the Gulf.
• Citic Securities says copper peak could test USD 15,000 per tonne this year, adding the timing of the US copper tariff assessment is approaching, reviving tariff trades and inventory hoarding in the copper market

Trade/Tariffs

• US Trade Representative made findings and proposed action on 60 economies under Section 301 investigations relating to failures to take action on trade in forced labour goods. Furthermore, the 60 economies involved included Australia, China, India, Japan, the UK, the EU, Mexico, Canada and many others.
• US Appeals Trade Court reportedly ordered broad IEEPA tariff refunds.
• US Deputy Agriculture Secretary said China has started placing orders for soybeans that are being planted right now across the US, according to WSJ.

Central Banks

• BoJ Governor Ueda said the BoJ needs to keep raising interest rates in response to developments in the economy and inflation. Ueda also stated that upside risks to prices appear to be greater overall and are likely to emerge sooner, while the Bank must consider taking action if there is a chance of second-round effects. To add, he said that there are no signs that past rate hikes are curbing corporate fund demand and an accommodative financial environment is supporting the economic activity.
• SNB Chair Schlegel reiterated an increased willingness to intervene in FX.
• ECB's Elderson said he do not yet see second round effects.
• ECB's Wunsch said an Iran peace deal won't derail the case for an ECB rate hike, according to FT.
• Fed Chair Warsh told staff he will conduct clear-eyed discussions about reform while upholding the best of the Fed's traditions, according to a memo.
• Fed Chair Warsh tapped two outside associates, Paul Winfree and Daniel Heil, to advise him while he settles into the job, according to WSJ citing sources.

Geopolitics

• Russia said it downed three drones and continued repelling a drone attack over the Leningrad region.
• Ukrainian President Zelensky said targets struck included a St. Petersburg oil terminal, with the Russian oil facility roughly 1,100 km from the Ukrainian border.

US Event Calendar

• 7:00 am: May 29 MBA Mortgage Applications, prior -8.5%
• 8:15 am: May ADP Employment Change, est. 120k, prior 109k
• 9:45 am: May F S&P Global US Services PMI, est. 51, prior 50.9
• 9:45 am: May F S&P Global US Composite PMI, est. 51.7, prior 51.7
• 10:00 am: Apr Factory Orders, est. 4.6%, prior 1.5%
• 10:00 am: May ISM Services Index, est. 53.8, prior 53.6
• 10:00 am: Apr F Durable Goods Orders, est. 7.9%, prior 7.9%
• 10:00 am: Apr F Durables Ex Transportation, est. 1.1%, prior 1.1%

Central Banks

• 9:00 am: Fed’s Barr in Moderated Discussion
• 2:00 pm: Fed Releases Beige Book
• 4:00 pm: Fed’s Logan in Moderated Discussion

DB's Jim Reid concludes the overnight wrap

This morning, I’m opening our annual European Leveraged Finance conference in London which has over a thousand issuers and investors attending…..  and one football manager! If I’m the opening act, Arsenal manager Mikel Arteta is doing the lunchtime address. As a Liverpool fan this is going to be a tough watch but I’m looking forward to hearing Mikel’s views on spreads, covenants, defaults and the rules around corners. 

Talking of defaults, yesterday saw Steve Caprio and team take on my baton and publish the annual 2026 Default Study. I first started this document back in 1999, and it's been dear to my heart since. In its 28th edition the study builds on the theme that we have expressed since 2022: The era of the ultra-low default regime is behind us. That does not imply default rates are spiking, nor that credit markets can't provide healthy returns. But the main message is to not let aggregate data and market prices make you think dispersion is going to disappear. Despite rather euphoric markets over the last 12 months, US spec-grade default rates are still at 4%, well above 20-year median levels of 2.9%. In Europe, spec-grade default rates of 4.6% are easily above 20-year median levels of 2.3%. There is lots and lots in the study so please take a look here.

Also this week, we published our latest semi-annual World Outlook, which is called “1999 meets 1990”. The title reflects the interplay of AI-driven optimism and the disruptive effects of the Middle East conflict, which makes it feel like those two years are now coinciding. 

The 1990 versus 1999 tug of war between Iran uncertainty and AI exuberance continued over the past 24 hours. Oil prices are grinding higher, with Brent +0.81% at $96.78/bbl this morning following a +1.07% rise yesterday with renewed clashes between the US and Iran overnight. But this hasn’t stopped US and Asian equities from posting new record highs, with the Nikkei (+2.96%) racing ahead this morning after outsized gains for chipmakers saw the S&P 500 (+0.13%) reaching its joint longest run of daily gains since 1995.

Starting with the Middle East, we’ve seen increasing pessimism that a US-Iran deal to re-open the Strait of Hormuz is imminent. New clashes took place overnight as US forces conducted strikes against Qeshm Island while Iran fired missiles and drones towards Kuwait and Bahrain, with the IRGC saying it targeted the US 5th Fleet headquarters in Bahrain. Meanwhile, further Israel-Lebanon talks are expected today, according to the US.

Prior to that, we saw little sign yesterday of concrete steps towards an imminent deal. For instance, Iran’s Mehr reported that “The final text from Iran is still under discussion in Tehran and no response has been sent yet”. Then later on, US Secretary of State Marco Rubio said that when it comes to a deal “it could happen today, it could happen tomorrow, it could happen next week”. This backdrop means WTI crude is now $7/bbl above Friday’s close, with a +0.92% rise at $94.62/bbl overnight.

Despite the rise in oil, the S&P 500 (+0.13%) just about posted a 9th consecutive advance yesterday, taking the index to a fresh record once again. For reference, we’re getting into historic territory, as it’s the longest run in the last year, and a 10th gain today would be the longest daily run since 1995. Moreover, the index is on the verge of several records, as it’s currently on track for a 10th consecutive weekly gain, which would be the longest run since 1985 if it manages it. On a monthly basis too, Henry pointed out yesterday (link here), that there’s only been 5 times since WWII when the index was up more than +16% in two calendar months, as happened in April and May. Three of them came at the end of recessions, but the one other non-recessionary instance was a few months before the Black Monday crash in 1987. So there’s been a stellar performance recently, but these runs haven’t always proved sustainable in the past.

Once again, chipmakers were in the driving seat for that advance, with the Philly Semiconductor index (+5.87%) extending its YTD gain to +94%.

This helped the NASDAQ (+0.03%) eke out a 9th consecutive gain to hit a new record of its own, even as software stocks (-3.55% within the S&P 500) saw their worst day since April. The Mag-7 (-0.99%) also underperformed, as Alphabet (-3.86%) fell back after its $80bn equity offering announcement with Microsoft (-4.17%) also slumping. Outside of the intra-tech dispersion, the rally was still a broad-based one, with the equal-weighted S&P 500 (+0.34%) hitting a new record too.

This morning, optimism surrounding AI continues to be prevalent in Asian markets. We've already discussed the Nikkei (+2.96%) at the top which is also being helped by additional Japanese stimulus (details below). In other markets, the S&P/ASX 200 (+0.80%) is experiencing gains as softer GDP figures have reduced expectations for interest rate hikes. Overall, broader Asian markets are largely positive, with the CSI (+1.55%) and the Shanghai Composite (+0.56%) also making advances, propelled by a robust services PMI reading. Conversely, the Hang Seng (-1.68%) stands out as an exception following a strong performance in the previous session. Outside of Asia, US stock futures are flat and 10-year USTs have increased by +1.4bps, trading at 4.46% as we prepare this report.

Turning to China, services activity expanded at its fastest pace in three months during May, as the RatingDog Services PMI rose to 54.4 from 52.6 in April, surpassing analysts' expectations of 52.3, driven by stronger domestic demand and new client acquisitions that enhanced business activity.

In another development, the Japanese cabinet has approved a draft supplementary budget of ¥3.1 trillion ($19.4 billion), which includes a newly established ¥2.5 trillion reserve fund aimed at addressing rising commodity prices through subsidies. Prime Minister Sanae Takaichi’s administration is seeking parliamentary approval for this budget by Friday. Although the specific applications of the fund have yet to be detailed, it is anticipated to help assist in alleviating high living costs resulting from the Iran conflict. Elsewhere in the region, early morning data indicated that Australia’s GDP grew by +2.5% year-on-year in the three months leading up to March 31, which was below the anticipated +2.7% increase and a decline from the +2.6% growth recorded in the previous quarter, as persistent inflation and escalating fuel prices due to the Middle East conflict have impacted private spending.

In an overnight development, the Office of the US Trade Representative (USTR) proposed new tariffs, ranging from 10% to 12.5%, targeting goods from major trading partners. This initiative stems from an investigation into the alleged use of forced labour in production. A 10% tariff is suggested for imports from nations including Canada, Mexico, the European Union, Taiwan, and the UK, with a higher 12.5% rate for economies like China, India, Japan, South Korea, Brazil, and Switzerland. Implementation of these levies is not immediate and is contingent on a public comment period (ending July 6th) and subsequent public hearings (starting July 7th). As a reminder the 150-day window for the current 10% Section 122 tariffs expires on July 24th so the timings can be seen to broadly match up.

Otherwise yesterday, speculation about a potential Fed rate hike continued, with futures taking the probability of a hike by December up to 71% by the close. In part, that followed the April JOLTS report, which added to recent signs that the labour market was in solid shape. Most notably, job openings hit their highest level since May 2024, at 7.618m in April (vs. 6.866m expected). And it also meant that the ratio of job openings per unemployed individuals reached 1.03, the highest since January 2025. So some positive signs on the US labour market, even if the overall ‘low hiring-low firing’ regime is continuing, with both quits and layoffs edging lower in April.

The other hawkish factor was comments from Cleveland Fed President Hammack. She had already dissented at the last meeting, calling for the easing bias to be taken out of the statement. But she also said in a speech yesterday that “it may soon be appropriate for policy to act to address the growing risks of persistently elevated inflation.” So that added to expectations that the Fed might hike, and we saw a clear flattening in the Treasury yield curve as a result, with the 2s10s curve down -2.0bps to 40bps by the close, which is the flattest it’s been in over a year. That came as the 2yr yield (+1.0bps) edged up to 4.04%, but the 10yr yield (-1.0ps) fell to 4.44%.

Earlier in Europe, markets had generally put in a stronger performance yesterday. However, that was because they were catching up to the more optimistic newsflow on Monday evening after they closed, rather than any fresh positive news yesterday. So equities rallied across the continent, with the STOXX 600 (+0.66%) paring back Monday’s losses. And sovereign bonds also rallied, with yields on 10yr bunds (-2.7bps), OATs (-3.4bps) and BTPs (-4.8bps) moving lower. As in the US however, there was a decent round of yield curve flattening, with pricing of an ECB rate hike next week up to 99%. That came as the flash Euro Area CPI print for May showed inflation at +3.2%, the highest since 2023, whilst core CPI also ticked up to +2.5%, a tenth above consensus expectations. In yesterday’s other notable market moves, Bitcoin fell -5.41% to $67,489, its biggest decline in almost four months. Interestingly it's probably the first time we've mentioned it for several weeks. It sits nearly half the value it peaked at in October last year.  

Looking at the day ahead, data releases include the final services and composite PMIs for May from several countries, and in the US we’ll get the ISM services index for May, the ADP’s report of private payrolls for May, and factory orders for April. From central banks, we’ll hear from the Fed’s Barr and Logan, and the ECB’s Rehn, Dolenc, Elderson and Cipollone, whilst the Fed will also release their Beige Book.

Following a shockingly strong JOLTS report, ADP just reported a stronger than expected rise in jobs added in May.

ADP says 122k jobs were added in May - better than the 120k expected - and the biggest monthly addition since January 2025

Source: Bloomberg

"Hiring was more broad-based in May than we've seen in the last few years," said Dr. Nela Richardson, Chief Economist, ADP.

"The labor market continues to show sustained momentum going into the summer hiring season."

Small businesses added the most jobs...

The Trade & Transportation  industry added the most jobs while Information services suffered the biggest losses (AI?)...

Year-over-year pay growth for job-stayers was steady at 4.4 percent. For job-changers, the pace of growth slowed slightly, to 6.5 percent from 6.6 percent in April.

And yet amid all this... we are supposed to believe (according to UMich) that Americans' consumer sentiment is at record lows?

Authored by Jackson Richman and Beige Luciano-Adams via The Epoch Times,

Los Angeles Mayor Karen Bass advanced to the November runoff election for Los Angeles mayor.

The Associated Press called Bass’s advancement after 1:30 a.m. ET on June 3. Reality TV star Spencer Pratt and Los Angeles City Councilmember Nithya Raman lead 11 other candidates in the race for runner-up.

The runner-up will face Bass in the runoff election on Nov. 3.

Bass campaigned on issues including affordability, public safety, and homelessness. Pratt focused his campaign on crisis management, fiscal responsibility, government reform, public safety, homelessness, infrastructure improvements, support for small businesses, and oversight of the Los Angeles Department of Water and Power.

Raman’s platform emphasized ending homelessness, expanding housing, protecting renters, improving public safety and transportation, environmental protection, immigrant rights, animal welfare, and support for small businesses.

Both Raman and Pratt have criticized Bass for her response to recent wildfires sweeping Los Angeles. Pratt’s home was destroyed in the Pacific Palisades fire in 2025.

A distinctive feature of Pratt’s campaign was the widespread use of artificial intelligence-generated videos created by supporters.

One of the most widely viewed videos opens with scenes of Los Angeles engulfed in flames, with Bass as a Joker-like villain and Pratt as a Batman-style hero promising change. In another, Bass is portrayed as Darth Vader from Star Wars, and in a third, she appears as the villain Thanos from Marvel’s Avengers franchise.

Former Florida Gov. Jeb Bush praised the Joker-themed video in a May 5 post on X, calling it “maybe the best political ad of the year.”

Bass has publicly criticized the AI-generated videos.

“Actually, I think it’s a very dangerous trend,” she said during a May 13 interview with CNN.

Los Angeles mayoral candidate Spencer Pratt visits 'Fox & Friends' at Fox News Channel Studios in New York City on May 28, 2026. Dimitrios Kambouris/Getty Images

She argued that some of the imagery, including scenes showing tomatoes thrown at her character in the Joker video, resembled blood and contributed to an increasingly hostile political atmosphere.

Bass warned that portraying political opponents as villains could influence unstable individuals and escalate tensions.

Los Angeles city councilwoman Nithya Raman speaks in Los Angeles on Aug. 7, 2024. John Fredricks/The Epoch Times

At the same time, she acknowledged that many voters are frustrated with current conditions and that Pratt has tapped into those concerns by presenting himself as a solution to the city’s challenges.

“I think that plays into people’s desperation, and I think oftentimes we look for someone superhuman to save us,” Bass said. “The reality is it never happens. Those are fictional characters.”

Voters Sound Off

In interviews with The Epoch Times, many voters at polling stations across L.A. County on Tuesday described a deep dissatisfaction with incumbent Karen Bass’s handling of the fires and the homelessness crisis.

Some embraced Pratt, while others said they would have preferred a more progressive candidate in the style of New York City’s Zohran Mamdani.

“Bass has failed us,” said Tom Perez, 69, a resident of East Los Angeles who said he has been a lifelong Democrat since he began voting in the 1970s. “It’s not that I don’t trust them as individuals, I just don’t trust the Democratic Party.”

Perez said he found Pratt empathetic, and his AI-fueled guerrilla campaign effective. “I feel for him, he lost his house. Even his commercials, who could not vote for him?”

Eduardo Cardenas, 28, also an East L.A. resident, a self-described political pessimist, said he was simply voting against the worst of what he’s seen.

“Like the Mayor [Bass], when the fires happened, I just didn’t like how she handled it. So I’ll pick a candidate that is most likely going to be the contender against that person. Basically, my preference is for anyone but her.”

Elizabeth, a 56-year-old West Adams resident who asked to be identified by her first name only, said her main priority was to ensure Pratt didn’t make it to the general election.

“I was struggling between Karen Bass and Nithya Raman, and I ultimately voted for Raman in a strategic vote, because I will do anything to keep Spencer Pratt off the ballot—I find him dangerous, unqualified—every negative thing possible,” she said.

“I used to live in New York City, and I would love a Mamdani here for mayor. Maybe Raman is that, I don’t know,” she said, adding that she has leaned more progressive in recent years as a result of rampant corruption among both parties.

A 31-year-old West Adams resident who goes by the name “Zochi” expressed a similar sentiment.

“I moved here recently. … I was in New York last year, so I got to experience Zohran and I was like, ‘Oh my God, this is amazing.’ And then I come here and I’m like, ‘Oh, there is not a lot going on here,” he said, referring to a “pretty weak ballot” in the primaries.

Meanwhile, residents in unincorporated areas and other cities in L.A. County who can’t technically vote for L.A. mayor but are impacted by the office’s policies, also weighed in on Bass.

“She’s doing a great job, but she didn’t do enough for the homeless, because you can see the shift—they’re now in other cities, and who’s tracking them? They’re in Montebello, where I live,” Lydia Leon, 67, told The Epoch Times at the L.A. County Registrar’s Office in Norwalk.

“If you go down any freeway, you’ll see tent after tent after tent. They’re all over the place. And maybe they’ve shifted out of downtown L.A., but they’re now all here and in the other cities.”

Joseph Trevisu, 20, said he was rooting for Pratt.

“I think anyone who lives in L.A. County and frequents the city of L.A. knows it’s a mess,” Trevisu said. “They need an outsider who’s going to come in and clean house.”

Trevisu, a college student, said his professors have drilled in him that the definition of insanity is doing the same thing over and expecting a different result.

“For a long time, us Democrats have been electing Democrats because they have a ‘D’ next to their name and expecting a different result,” he said. “The party is out the window. I think we’re all sick and tired of this stuff.”

For the first time since 1999, the New York Knicks are heading to the NBA Finals. For fans, it's a dream decades in the making. For anyone hoping to attend a game at Madison Square Garden, however, that dream comes with a staggering price tag in the thousands of dollars. 

The 2026 NBA Finals between the New York Knicks and the San Antonio Spurs have produced some of the most expensive basketball tickets ever recorded. Secondary-market prices have surged to levels that rival — and in some cases exceed — major championship events such as the Super Bowl.

The cheapest tickets available for Knicks home games in the Finals have generally been listed between $3,600 and $4,100. Reports from TickPick, SeatGeek, and other ticket marketplaces showed get-in prices exceeding $3,800 for some Madison Square Garden games, while average ticket prices in New York have hovered around $6,000.

Even compared with the already-expensive games in San Antonio, Madison Square Garden stands in a category of its own. While some Spurs home games have had entry prices closer to $1,200-$2,000, New York's home games have consistently commanded much higher premiums.

The biggest shock has come at the luxury end of the market. One pair of courtside Knicks Finals tickets reportedly sold for nearly $280,000 on the secondary market. Individual premium seats have been listed for well into six figures, with some season-ticket holders reportedly considering offers approaching $100,000 per seat.

To put that into perspective, the cost of sitting courtside for a Knicks Finals game can exceed the price of a luxury automobile or a down payment on a home in many parts of the United States.

Several factors are driving the unprecedented demand. First, the Knicks have not appeared in the NBA Finals since 1999, creating nearly three decades of pent-up demand among one of sports' largest fan bases. Second, Madison Square Garden has a relatively limited seating capacity compared with many newer arenas. Finally, the New York metropolitan area contains one of the world's largest concentrations of affluent sports fans and corporate buyers willing to pay premium prices for marquee events.

The combination has created a perfect storm in which demand dramatically exceeds supply.

The difference between today's prices and those from the Knicks' previous Finals appearances is striking. According to reporting comparing 2026 prices with the 1994 NBA Finals, upper-level seats that once cost roughly $35 now carry prices well above $1,700, while even the least desirable seats for the current Finals often cost several thousand dollars.

In inflation-adjusted terms, Knicks Finals tickets have become dramatically less accessible to the average fan.