Good morning,
 
It feels weird to work after a Knick loss. Hasn’t happened in a long time. Yesterday tech bounced from its Friday selloff, led by semis, pushing the S&P 500 to a modest 0.3% gain. However sector breadth was poor with 8 sectors ending lower, though thematic, high beta names saw strength, driving outperformance in the small caps (Russell 2000 +0.8%). Oil gained but came off its highest levels after Israel and Iran exchanged fire over the weekend but then said those activities concluded. News flow around tech was robust and the ICE Semis Index rose 6%.
 
US futures are trading higher this morning along with global equities overall and are near best levels. Optimism around an Iran-US agreement, generally lower global yields and a step back in oil are helping equities. Tech is trading well in the pre-market (XLK +1%), following sharp gains in global players (Samsung +9%, Tokyo Electron +9%, SK Hynix +15%). OpenAI has filed confidentially for an IPO but added “it may be a while”. Sailpoint, Designer Brands and Vail Resorts are trading lower following earnings while Smuckers and Academy Sports trade higher.
 

 
Major European indexes are higher with the exception of some weakness in the UK. Financials and consumer/retail names across the region are generally higher. German Industrial Production improved from last month and exports saw stronger growth as well. Japan’s Nikkei bounced over 2%, following Monday’s 4% decline. USD/JPY yen continued to flirt with ¥160. Chinese markets were mostly higher though the Hang Seng fell slightly. The Chinese government is considering a $300B, 5-yr program to build data centers across the country according to reports. The country’s trade balance rose more than expected in May. Export and import growth were both above consensus and up from April. Global stockpiling likely contributed a temporary push to the numbers. However oil imports fell to their lowest levels since 2017 as the country draws down inventories in the midst of the Iran conflict. The Dept of Defense updated its list of “Chinese military companies”- entities it views as providing, commercial services, manufacturing, producing, or exporting for China’s military. Several big names including Baidu, WuXi, BYD, and Alibaba were added, and the WSJ said those companies disagreed with their inclusion and will look to remove themselves from it. Companies on the list are barred from doing business with the U.S. military. South Korea saw a sharp rebound after falling ~15% on Friday and Monday. Taiwan is reported to be exploring restriction on AI chip exports to China. Indonesia’s central bank raised rates unexpectedly to support the currency.
 

 
NFIB Business Optimism fell from last month and missed expectations. Job openings and hiring plans dropped to lowest level in six years. The ADP weekly job report showed 29k private jobs/week were added over the past 4 weeks, roughly inline with the prior reading of 30.5k, which was revised down from 35.75k. April’s trade balance was also roughly inline with the prior month. Treasury yields are down a few bp along with oil’s move. The US Dollar Index is moving lower after trading above 100 the past two days.
 

• US 2yr -3bps to 4.14%, 5yr -2bps to 4.27%, 10yr -2bps to 4.55%, 30yr -2bps to 5.02%
• USD index: -$0.33 to $99.69

 
As noted crude is lower this morning, unable to rally above its 50d ma so far as Iran deal optimism takes hold again. Gold and silver are relatively unchanged, with gold trading below its 200d ma and silver trying to hold on to it. Bitcoin and ETH are back to seeing selling pressure after yesterday’s short reprieve. Ag is trading higher.
 
  
 
Earnings:
After-Market: MTN, ODC
Pre-Market:  ASO, DBI, LE, SAIL, SJM, UEC, UNFI
After-Market: BARK, CASY, CBRL. CNM, DOMO, LAKE, SKILL
     
Economic Data:
US:

• NFIB Business Optimism: 95.3 vs 96.0 cons, prior 95.9
• ADP weekly employment change: 29K vs prior 30.5k
• Trade Balance: $-55.9B vs prior $-60.3B
• 10am Existing Home Sales
• 10am Inventories
• 12:00pm EIA Short-Term Energy Outlook
• 1:00pm 3yr auction
• 4:30pm API crude stock

Global:

• China May Exports y.y: 19.4% / 27.4% vs 15.0% / 25.0% cons, prior 14.1% / 25.3%
• Germany Exports / Imports m.m: 0.9% / 1.2% vs prior 0.3% / 4.5%
• Germany Industrial Production m.m: 0.4% vs 0.4% cons, prior -0.1%
• Indonesia rate decision: raised 25bp
• Taiwan Exports / Imports y.y: 51.7% / 54.9% vs 37.9% / 37.4% cons, prior 39.0% / 29.2%
• Mexico Core CPI m/m: 0.22% vs 0.24% cons, prior 0.31%