Daily Game Plan

by Contributor
on June 2, 2025

TODAY’S GAME PLAN:  from the trading
desk, this is not research

TODAY’S ECONOMIC DATA:  9:45ET S&P Global US Manufacturing PMI; 10:00ET ISM Manufacturing, ISM Prices Paid, ISM
New Orders, ISM Employment, Construction Spending MoM; 10:15ET Fed’s Logan speaks; 12:45ET Fed’s Goolsbee speaks, Fed’s Powell speaks

Highlights and News:  

  • Iran Drafting A ‘Negative’ Response to US Nuclear Proposal
  • Ukraine will push for an unconditional ceasefire at upcoming talks with Russia in Istanbul
  • Ukrainian drones hit Russian airfields as far away as eastern Siberia
  • JPMorgan Strategists See Stagflation Threat Ending S&P Rebound
  • Fed’s Waller said he still sees a path to rate cuts this year

 

Global stocks declined with tensions rising again over tariffs and trade. The latest twists in President Trump’s tariff agenda have heightened market uncertainty,
following mutual accusations between the US and China of violating a trade deal, and Trump’s pledge to double tariffs on all steel and aluminum imports to 50% starting June 4. Beijing rejected Trump’s trade criticism, suggesting a call between Trump and Xi
may not happen soon. Meanwhile, Iran is drafting a ‘negative’ response to US nuclear proposal, according to a senior Iranian official. Elsewhere, EU Trade Commissioner Sefcovic is set to meet US Trade Representative Greer in Paris on Wednesday. In Poland,
nationalist opposition candidate Karol Nawrocki secured a narrow victory in the presidential election, dealing a significant setback to the centrist government’s push to strengthen Warsaw’s pro-European stance.
Russia and Ukraine will resume peace talks in Istanbul, following Ukraine’s aerial attack inside Russia that destroyed long-range bombers and other aircraft.

 

EQUITIES: 

US equity futures fell as Trump’s late Friday announcement of the new steel and aluminum levies weighed on sentiment. The president also accused China of violating an agreement with the
US to mutually roll back tariffs and trade restrictions for critical minerals. The threat of stagflation and continued uncertainty over trade negotiations will keep stocks in check in the coming months, according to JPMorgan strategists. The strategists said
they continue to prefer international stocks over the US, where valuations are stretched. Meanwhile, the Trump administration is finalizing a plan to reduce capital requirements for major banks, Politico reported.

Futures ahead of the bell: E-Mini S&P %, Nasdaq %, Russell 2000 %, DJI %.

In pre-market trading, Boeing Co. shares (BA) rise 1.3% after BofA Global Research upgraded the plane maker to buy from neutral. Kura Oncology (KURA) advances 4.4%
after announcing the US Food and Drug Administration has accepted the pharmaceutical company’s New Drug Application seeking full approval for ziftomenib. Moderna shares (MRNA) are up 4% after the drugmaker won FDA approval for its second-generation Covid vaccine.
Shares in US steel and aluminum stocks are rallying as President Trump said he would be increasing tariffs on steel and aluminum to 50% from 25%. Cleveland-Cliffs (CLF) shares soared 32% in premarket trading, Steel Dynamics rose 13%, and Nucor jumped 13% after
Trump said the move would strengthen the domestic steel industry. Tesla shares (TSLA) are down 1.5%, leading Magnificent Seven stocks lower.

European gauges are mixed to lower in cautious trading as investor’s hopes for lasting resolution to the trade tensions soured. The UK will urge Trump to apply an agreed
zero-tariff accord to steel, the FT said, after the president vowed on Friday to double levies to 50%. Defense stocks rose as the UK planned to spend £1.5 billion ($2 billion) to build six munitions factories, expand its fleet of attack submarines and invest
in its nuclear deterrent. The UK manufacturing economy picked up but remained in contraction territory in May, data showed, amid weak global demand and turbulent market conditions. In Poland, a nationalist candidate backed by Trump won the presidential election,
defeating the centrist mayor of Warsaw in a blow to the country’s pro-European Union government. Stoxx 600 -0.15%, DAX -0.3%, CAC 00.5%, FTSE 100 +0.1%. Autos -1.8%, Media -1.5%, Technology -1.1%. Energy +1.5%, Aero & Defense +0.7%, Healthcare +0.5%.

Shares in Asia dropped, as risk-off sentiment prevailed amid resurgent US-China trade tensions. The MSCI Asia Pacific Index fell as much as 1% before paring losses
to 0.2%. Shares in South Korean and Vietnamese steelmakers, major exporters of the metal to the United States, dropped after Trump said he would double tariffs on imported steel and aluminum to 50%. South Korea’s Industry Ministry said in a statement it had
held an emergency meeting with officials from the country’s major steelmakers. Chinese chip stocks in Hong Kong fell as the Trump administration makes plans to broaden restrictions on China’s tech sector. China accused the US of violating their trade agreement
and has vowed to protect its interests. Markets in mainland China, Thailand and Malaysia were closed for holidays. Taiwan -1.6%, Indonesia -1.5%, Nikkei 225 -1.3%, Hang Seng Index -0.6%, ASX 200 -0.2%, Sensex -0.1%. Kospi +0.05%, Philippines +0.2%, Vietnam
+0.3%.

FIXED INCOME: 
 

Treasuries are slightly cheaper across the curve — with losses led by long-end tenors amid a similar bear-steepening move in core European rates.  Fed Governor Christopher
Waller said that cuts remain possible later this year as he saw downside risks to economic activity and employment and upside risks to inflation from the tariffs. Rising oil prices adds to upside pressure on yields, after OPEC+ increased production less than
expected. US session includes manufacturing gauges and remarks by Fed Chair Powell.  2s10s and 5s30s spreads 1bp steeper on the day. 10-year around 4.435% is ~3bp cheaper.

 

METALS: 

Gold surged over 2% due to increased demand for safer assets amid rising tensions between the US and China, and escalating conflict between Russia and Ukraine. The
US-China trade truce is at risk as both sides accuse each other of reneging on their recent deal, and President Trump vows to double import tariffs on foreign steel and aluminum. Spot gold rose above $3,360 an ounce, with Goldman Sachs predicting it will remain
a hedge against inflation in long-term portfolios, alongside oil.  Spot gold +2.2%, Silver +1.3%, Copper +4.7%.

 

 

ENERGY:   

 

Oil prices jumped on a combination of heightened geopolitical tensions and an OPEC+ production increase that was less than some had feared. OPEC+ agreed to increase
oil output by 411,000 barrels a day in July, the same level as the previous two months, despite reservations from Russia and other members. Meanwhile, low U.S. fuel inventories have stoked supply jitters ahead of what is expected to be a more active than usual
hurricane season, analysts said. Iran warned it won’t strike a nuclear deal with the US unless Washington gives assurances that any agreement will include sanctions removal. WTI +4.2%, Brent +3.8%, US Nat Gas +6.7%, RBOB +3.0%.   

 

CURRENCIES: 

In currency markets, the dollar fell versus all Group-of-10 currencies as hedge funds added to short exposure amid signs of escalating US trade tensions. Fed Governor
Christopher Waller said he continues to see a path to interest-rate cuts later this year. Scandinavian currencies lead G-10 gains, with USDNOK down over 1%. Sterling rose after figures from Nationwide Building Society showed UK house prices unexpectedly rose
in May. US$ Index -0.5%, GBPUSD +0.6%, EURUSD +0.6%, USDJPY -0.9%, AUDUSD +0.8%, NZDUSD +0.9%, USDCHF -0.6%, USDCAD -0.3%, USDSEK -0.9%, USDNOK -1.3%.

 

 

Bitcoin -1%, Ethereum -1.7%. 

 

Colors within the report:
Green is always the 200 period (day, week).
Red is always 21,
Blue = 50,
Brown =
100 *Stars have added importance 

  • Upgrades
    • ArcBest (ARCB) Raised to Buy at Goldman; PT $101
    • BCE (BCE CN) Raised to Sector Outperform at Scotiabank; PT C$39
    • Church & Dwight (CHD) Raised to Outperform at RBC; PT $114
    • Doximity (DOCS) Raised to Buy at BTIG; PT $80
    • Knight-Swift (KNX) Raised to Buy at Goldman; PT $65
    • Nucor (NUE) Raised to Outperform at BMO; PT $145
    • Old Dominion (ODFL) Raised to Buy at Goldman; PT $200
    • Red Rock Resorts (RRR) Raised to Outperform at Mizuho Securities
    • Rollins (ROL) Raised to Buy at Jefferies; PT $65
    • Saia (SAIA) Raised to Buy at Goldman; PT $410
    • Schneider National (SNDR) Raised to Buy at Goldman; PT $32
    • Werner Enterprises (WERN) Raised to Buy at Goldman; PT $39
  • Downgrades
    • Algoma Steel Group (ASTL CN) Cut to Market Perform at BMO; PT C$8
    • Arvinas (ARVN) Cut to Market Perform at Leerink; PT $9
    • Canadian Pacific Kansas (CP CN) Cut to Neutral at Goldman; PT C$126
    • CSX (CSX) Cut to Neutral at Goldman; PT $35
    • JB Hunt (JBHT) Cut to Neutral at Goldman; PT $164
    • Laurentian Bank of Canada (LB CN) Cut to Sell at Veritas Investment Research Co; PT C$26
    • Norfolk Southern (NSC) Cut to Neutral at Goldman; PT $278
    • Northwestern (NWE) Cut to Neutral at Ladenburg Thalmann; PT $56
    • Rackspace Technology (RXT) Cut to Market Perform at Raymond James
    • Shake Shack (SHAK) Cut to Neutral at BTIG
    • Union Pacific (UNP) Cut to Neutral at Goldman; PT $263
  • Initiations
    • Affirm Holdings (AFRM) Rated New Buy at Truist Secs
    • American Integrity Insurance Group (AII) US Rated New Outperform at Raymond James; PT $20
      • US Rated New Market Perform at Oppenheimer
      • Rated New Outperform at KBW
      • US Rated New Overweight at Piper Sandler; PT $20
      • US Rated New Market Outperform at Citizens; PT $23
    • Aspen Insurance (AHL) Rated New Buy at Citi; PT $43
      • Rated New Equal-Weight at Wells Fargo; PT $37
      • Rated New Overweight at Piper Sandler; PT $40
      • Rated New Market Outperform at Citizens; PT $45
      • Rated New Neutral at Goldman; PT $38
      • Rated New Buy at Jefferies; PT $42
      • Rated New Outperform at BMO; PT $38
    • BILL Holdings Inc (BILL) Rated New Hold at Truist Secs; PT $47
    • Block (XYZ) Rated New Sell at Truist Secs; PT $60
    • Boundless Bio (BOLD) Rated New Buy at HC Wainwright; PT $5
    • Cardiol Therapeutics (CRDL CN) Rated New Buy at HC Wainwright; PT $9
    • Coca-Cola HBC (CCH LN) ADRs Rated New Outperform at BNPP Exane; PT $57.30
    • Dlocal (DLO) Rated New Hold at Truist Secs; PT $12
    • DraftKings (DKNG) Rated New Buy at Baptista Research; PT $52.50
    • Fidelity National (FIS) Rated New Hold at Truist Secs; PT $84
    • Fiserv (FI) Rated New Buy at Truist Secs; PT $181
    • Flywire (FLYW) Rated New Buy at Truist Secs; PT $12
    • Global Payments (GPN) Rated New Hold at Truist Secs; PT $79
    • Global-e Online (GLBE) Rated New Sell at Truist Secs; PT $31
    • Lightspeed Commerce Inc (LSPD CN) Rated New Hold at Truist Secs; PT $11
    • Mastercard (MA) Rated New Buy at Truist Secs; PT $640
    • PayPal (PYPL) Rated New Sell at Truist Secs; PT $68
    • Puig (PUIG SM) ADRs Rated New Neutral at BNPP Exane; PT $9.90
    • RPM International (RPM) Rated New Buy at Citi; PT $135
    • Shake Shack (SHAK) Rated New Sector Weight at KeyBanc
    • Shift4 Payments (FOUR) Rated New Hold at Truist Secs; PT $97
    • SoFi Technologies (SOFI) Rated New Hold at Truist Secs; PT $14
    • Spin Master (TOY CN) Reinstated Neutral at CIBC; PT C$28
    • Toast (TOST) Rated New Buy at Truist Secs; PT $48
    • United Therapeutics (UTHR) Rated New Overweight at Cantor; PT $405
    • Visa (V) Rated New Buy at Truist Secs; PT $400
    • Western Union (WU) Rated New Perform at Oppenheimer

 

 

 

 

 

 

 

Data sources: Bloomberg, Reuters, CQG

 

 

David Wienke

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Charts

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