Market Quick Take – 27 May 2025

Market drivers and catalysts

• Equities: Trump delays tariffs; EU stocks rebound; tech, autos in focus
• Volatility: VIX spikes, VIX futures drop; contango holds; NVDA/PCE ahead
• Digital assets: BTC steady; IBIT strong flows; crypto stocks weak
• Fixed Income: Long Japanese Government Bond yields swoon on story that MoF may tweak auction sizes to avoid pressure on market.
• Currencies: USD rebounded overnight, led by USDJPY on JGB yield plunge.
• Commodities: Technical selling weighing on gold and silver, and supply concerns on crude
• Macro events: France Flash May CPI, US May Conference Board Consumer Confidence

Macro data and headlines

• According to Reuters sources, Japan’s Ministry of Finance sent a questionnaire to JGB auction market participants to possibly tweak the amounts of bonds it issued at the long end of the yield curve – sending Japanese yields and the Japanese yen lower (more below under Fixed Income).
• Bloomberg reported yesterday that the EU has agreed to accelerate negotiations on terms of trade with the US, a move likely prompted by Trump’s threats ahead of the weekend to slap 50% tariffs on EU imports on June 1 (that threat was suspended until July 9, but now hangs over the trade talks).
• Sales of new single-family homes in the US rose by 10.9% to 743,000 units, exceeding expectations of 692,000. This marks the largest increase since August 2022 and the highest sales since February 2022, driven by builder incentives despite rising mortgage rates.
• China's industrial profits rose 3% in April from a year earlier, up from 2.6% in March, driven by a government trade-in program driving demand for manufactured products despite pressure from higher U.S. tariffs.

Macro calendar highlights (times in GMT)

0645 – France May (Preliminary) CPI
0900 – Eurozone May (Final) Consumer Confidence
1230 – US April (P) Durable Goods Orders
1300 – US Mar. S&P CoreLogic Home Price Index
1400 – US May Conference Board Consumer Confidence
1430 – Dallas Fed Manf Activity
1700 – US to sell USD 69 billion 2-year Notes
0130 – Australia April CPI
0200 – New Zealand RBNZ Official Cash Rate announcement

Earnings events

• Today: Xiaomi
• Wednesday: Nvidia, Salesforce, Synopsys, Veeva Systems, Agilent, HP
• Thursday: Dell, Marvell Technology, Zscaler, Netapp
• Friday: Costco

For all macro, earnings, and dividend events check Saxo’s calendar.

Equities

• US: US stock futures jumped Tuesday after President Trump postponed the 50% EU tariff deadline to July 9, following a volatile prior week driven by fiscal fears and trade tensions. Last week, the Dow -2.5%, S&P 500 -2.6%, and Nasdaq -2.5% with Apple down 7.6% on tariff threats. Investors are now focused on key US data—durable goods, housing, and consumer confidence—plus earnings from Okta today, Nvidia, Macy’s, and Costco later this week. The “Trump Pattern” of threats followed by relief continues to drive sharp market reversals.
• Europe: European stocks rallied Monday, reversing Friday’s losses after Trump delayed tariffs. The STOXX 50 +1.3%, DAX +1.68%, and CAC 40 +1.21%, led by German exporters and automakers (Volkswagen +2.3%, Daimler Truck +2.2%). Optimism followed the EU’s commitment to finalize a deal by July 9. Gains were broad across pharmaceuticals, machinery, and luxury stocks. However, investor fatigue is setting in from repeated tariff scares and rebounds, raising concerns over the resilience of future rallies.
• Asia: Asian equities traded mixed. Japan’s Nikkei +0.5% as yen weakness offset rate hike concerns, supporting exporters. Hong Kong’s Hang Seng hovered near 23,312 after Monday’s selloff, driven by Trump’s iPhone tariff threats and heavy EV sector losses (BYD -3%, Geely -3%, NIO -1.6%). Chinese industrial profits and export data were solid, but ongoing trade risk and profit-taking limited momentum. Asia tech suppliers to Apple and Samsung remained under pressure.

Volatility

Volatility spiked into Friday’s close with VIX ending at 22.29 (+10% vs Thursday). VIX futures fell back to 20.80, leaving the curve in shallow contango. Options volumes were elevated, especially in mega-caps like Nvidia, but put-skew narrowed as some hedges were unwound. Vol remains high but not panicked, as traders await Nvidia earnings and Thursday’s PCE inflation data.

Digital Assets

Bitcoin retreated to $109.1K (-0.3%), cooling from last week’s highs, while ETH held at $2,590 (+1%). Crypto market cap remains firm above $3.43T, as robust ETF inflows anchor sentiment: BlackRock’s IBIT pulled in $530M last week, though it slipped 2.2% to $61.83 on Friday. Crypto stocks (COIN -3.2%, MSTR -7.5%, MARA -5.9%) lagged broader tokens. ETF flows and upcoming macro events are keeping crypto volatility subdued relative to equities, despite macro jitters.

Fixed Income

• Japanese long bond yields plunged after the finance ministry surveyed market participants on suitable government bond issuance amounts, according to Reuters. This suggests an official response to the runaway advance in yields, especially at 20-years and longer maturities. This comes after a recent JGB auction of 20-year bonds saw weak demand. The 20-year yield had dropped more then 20 basis points as of this writing to below 2.35% after trading as high as 2.6% last week.
• German 10-year Bund yields are likely to eye more than 2-week lows near 2.50% today as US treasury yields trade lower overnight. This after the news of Trump’s delaying threatened tariffs on Monday failed to inspire much of a sell-off in Bunds after Friday’s significant rally.

Commodities

• Gold trades lower for a second day with technical selling along a descending trendline - today at USD 3,354 - from the April record high being supported by reduced haven demand amid rising stocks after Trump softened his aggressive trade stance with the EU. Gold-backed ETFs registered a fifth weekly outflow last week while leveraged managed money accounts turned net buyers for the first time in ten weeks.
• Platinum extended declines after last week's strong rally to a two year high on signs of market tightness, while silver trades softer after once again failing to breach resistance above USD 33.50
• Crude trades softer ahead of a 31 May meeting between eight OPEC+ members that could result in another bumper production increase from July of 411k b/d. Losses however is being limited by extended US-EU trade talks, while Iran nuclear talks are ongoing with the outcome potentially leading to either lower or tougher US sanctions.

Currencies

• USDJPY rallied sharply from new local lows and JPY was broadly weaker overnight on a Reuters story that Japan’s Ministry of Finance plans to take steps to tame the runaway rise in yields at the long end of the Japanese yield curve, suggesting that the MoF may tweak issuance at the long end of the yield curve on reports that it sent a questionnaire to market participants on how much to auction. See above for the strong reaction to the JGB market as Japan’s long yields were crushed overnight.
• Led by a backup rally in USDJPY on the story above, the US dollar rallied overnight, leaving many USD pairs back where they were on Friday and wondering what the next steps are for the market when the US comes back from its long holiday weekend today.
• New Zealand’s central bank the RBNZ announces rates on Wednesday (tonight at 0200 GMT), expected to cut its official cash rate by 25 basis points to 3.25%, with guidance for the future course of policy closely watched as the following meeting in July is not fully priced to deliver another cut.

For a global look at markets – go to Inspiration.