Closing Recap

U.S. stocks ended a strong month on a mixed note Friday, with the S&P 500 and Nasdaq seeing modest declines as profit-taking emerged amid renewed tariff uncertainty following comments from President Trump, though major indices still posted significant gains for both the week and the month of May. 

Looking Ahead

Looking ahead, the market transitions from a month of strong gains to a week dominated by central bank decisions and critical labor market data. The Bank of Canada (Wednesday) and the European Central Bank (Thursday) are both set to announce their latest monetary policy stances. While the BoC decision is finely balanced (money markets pricing only 5bps of easing), the ECB is widely expected to cut rates by 25bps, with focus on forward guidance given remaining inflation concerns and recent trade uncertainties. The week culminates with the US Jobs Report for May (Friday). Consensus expects a slowdown in payroll growth to 130k, which, along with wage data, will be a crucial input for the Federal Reserve’s policy outlook. 

Key activity indicators are also due, with final May Manufacturing PMIs (Monday) and Services/Composite PMIs (Wednesday) from the US, Eurozone, and UK, alongside the closely watched US ISM Manufacturing (Monday) and Services (Wednesday) PMIs. Other important releases include Australian Q1 GDP (Wednesday), Eurozone Flash CPI for May (Tuesday), and the Canadian Jobs Report (Friday).

Key Takeaways 

• Stellar May Performance: The S&P 500 (+6.15%), Nasdaq (+9.56%), and Dow (+3.94%) all registered their biggest monthly percentage gains since November 2023. The S&P 500 had its strongest May since 1990, and the Nasdaq its best May since 1997. 
• Weekly Gains Continue: For the week, S&P 500 +1.88%, Nasdaq +2.01%, Dow +1.6%. 
• Tariff Uncertainty Lingers: President Trump’s comments indicating China violated trade agreements spurred some profit-taking on Friday, despite recent de-escalation. 
• Core PCE In-Line: Key Core PCE inflation data met expectations, providing a brief relief bounce in futures before markets opened lower. 
• Gold & Oil Retreat Friday: Gold futures reversed Thursday’s gains, and oil prices slipped as profit-taking hit broad markets and the Dollar climbed. 
• Treasury Yields Rise in May, Fall for Week: The 10-year Treasury yield saw its largest one-month gain since Dec 2024 but fell for the week, snapping a four-week rising streak. 
• Week Ahead Focus – BOC and ECB deliver rate decisions; NFP and Global PMIs & ISM; Australian GDP, and Canadian Jobs  in focus. 

Market Overview 

U.S. equity markets capped off an exceptionally strong month of May, with the S&P 500 and Nasdaq recording their largest monthly percentage gains since November 2023, and the S&P 500 marking its best May performance since 1990. For the week, major indices also posted solid gains. However, Friday’s session saw a more subdued and slightly negative tone as profit-taking emerged. Early futures weakness was exacerbated by comments from President Trump suggesting China had already violated recent trade agreements, injecting a fresh wave of uncertainty into the market. While the key Core PCE inflation data came in line with expectations, providing a brief moment of relief, it wasn’t enough to fully dispel the cautious sentiment heading into the weekend. 

Index	Last Closing Level	Friday’s Change	Friday’s Change (%)	Weekly Change (%)	Monthly Change (%)
DJ Industrials	42270	54.34	0.0013	0.016	0.0394
S&P 500	5911	-0.48	-0.0001	0.0188	0.0615
Nasdaq	19113	-62.11	-0.0032	0.0201	0.0956
Russell 2000	2066	-8.49	-0.0041

The renewed trade jitters and a generally risk-off mood on Friday impacted commodity markets. Gold futures reversed the previous day’s gains, and crude oil prices also slipped, partly due to expectations of OPEC+ production increases and lagging U.S. gasoline demand. The U.S. dollar, however, found some strength. Treasury yields had a notable month, with the 10-year yield recording its largest one-month gain since December 2024, though it did fall for the week, breaking a four-week streak of increases.

Economic Data Calendar (Week of June 2nd)

 MON (Jun 3): 

• EZ/UK/US Final Manufacturing PMIs (May): Final reads on factory activity. 
• US ISM Manufacturing PMI (May): Consensus 48.7 (unch.). S&P Global Flash PMI rose to 52.3, showing order growth but continued job cuts.

 TUE (Jun 4): 

• RBA Minutes (May Meeting): Details from the RBA’s May meeting where they cut rates by 25bps. 
• EZ Flash CPI (May): Key Eurozone inflation data ahead of ECB meeting. 
• US Factory Orders (Apr): (Note: Durable Goods was listed last week, Factory Orders typical follow-up) 

WED (Jun 5): 

• Bank of Canada (BoC) Rate Decision: Statement-only meeting. Markets pricing only ~5bps of easing (hold more likely) after recent hot inflation/strong GDP. Previous meeting minutes showed split council. 
• Australian GDP (Q1): Growth data following RBA’s May rate cut and cautious outlook. EZ/UK/US Final Services & Composite PMIs (May): Final reads on service sector and overall business activity. 
• US ISM Services PMI (May): Consensus 52.0 (from 51.6). S&P Global Flash PMI rose to 52.3, with strong domestic demand but sharp fall in service exports linked to trade policy. Prices charged surged.

 THU (Jun 6): 

• European Central Bank (ECB) Rate Decision & Press Conference: 25bps rate cut widely expected (95% priced in). Focus on forward guidance, any dissent, and updated macro projections (growth likely revised down, 2025 inflation trimmed, 2026 inflation potentially up). 
• Swiss Unemployment (May): Labor market data for Switzerland. 
• EZ PPI (Apr): Eurozone producer price inflation. 
• Canadian Trade Balance (Apr): Trade figures for Canada. 

FRI (Jun 7): 

• Reserve Bank of India (RBI) & Central Bank of Russia (CBR) Rate Decisions: Policy meetings for key emerging markets. 
• German Trade Balance (Apr): Trade data for Europe’s largest economy. 
• EZ GDP (Q1 – Revised), Retail Sales (Apr), Employment (Q1 – Final): Updated Eurozone growth, consumption, and labor market figures. 
• US Jobs Report (May): Headline NFP exp. 130k (vs 177k prior). Unemployment rate exp. steady at 4.2%. Avg. Hourly Earnings exp. +0.3% M/M. Fed minutes noted rising risks to labor market. 
• Canadian Jobs Report (May): Labor market data, will shape expectations for July BoC meeting. 

Commodities, Currencies, and Treasuries 

Gold futures retreated on Friday, settling near $3,315/oz, as profit-taking emerged across broad markets and the U.S. dollar strengthened. For the week, however, gold’s direction was mixed following the prior week’s losses. WTI crude oil futures also slipped on Friday, finishing the session around $60.79/bbl, pressured by expectations of OPEC+ production increases and concerns about U.S. gasoline demand, though late Trump comments on China provided a small, insufficient rally. The 10-year U.S. Treasury yield rose significantly by 24.5 bps during May, its largest monthly gain since December 2024, to end near 4.42%. However, for the week, the 10-year yield was down about 9 bps, snapping a four-week streak of increases. The U.S. dollar showed strength into the weekend.

Asset	Last Level	Friday’s Change	Unit / % Change
WTI Crude	60.79	-0.15	USD/bbl
Brent Crude	63.9	-0.25	USD/bbl
Gold (Aug Fut.)	3315.4	-28.5	USD/oz
EUR/USD	1.1359	-0.0012	Rate
USD/JPY	143.9	-0.29	Rate
10-Year Note Yield	0.04422	-0.00002	Yield (%)