General trend

– Crude Oil FUTs declined on Saudi-related stocks.

– Banks decline amid comments from JPMorgan CEO.

– Shanghai Composite ended the morning up slightly.

– Hang Seng extended declines ahead of Tech earnings.

– Meituan will announce its results after market close.

– Evergrande’s onshore unit is planning a meeting of bondholders on June 1-2.

– The parity of Japanese equities falls.

– Fast Retailing will release its monthly sales after Tokyo closes.

– Australia’s consumer staples and financials are lagging.

– Quiet session so far for US equity FUTs.

– The Chinese Ministry of Commerce (MOFCOM) sometimes holds weekly press conferences on Thursdays.

– US ADP data expected later today.

– Companies due to report during the New York morning include Ciena Corp, Designer Brands, Hormel Foods, Lands’ End, SecureWorks, SpartanNash.

– Shanghai and Hong Kong markets are closed for holidays on Fridays. (June 3).

Securities/Economic data

Australia/New Zealand

– ASX 200 open flat.

– (AU) April trade balance in Australia (A$): 10.5 B against 9.0 Be.

– (AU) Chinese ambassador to Australia says trade sanctions against Australia will not be lifted – press.

– (NZ) New Zealand Q1 Q/Q Terms of Trade Index: 0.5% vs. 1.3%e.

– (NZ) New Zealand sells NZ$200M against NZ$200M shown in bonds 2027 and 2051.

Japan

– Nikkei 225 opened -0.4%.

– (JP) Said Japan is considering raising the daily arrival cap of 30,000 arrivals to the country in July – Press.

– (JP) Monetary base of Japan in May Y/Y: 4.6% vs. 6.6% before [slowest pace since May 2020].

– (JP) Japan’s MoF sells ¥2.6t vs. ¥2.6t quoted in 0.1% 10yr JGBs; average return 0.2390% versus 0.2450% before; bid to cover: 4.86xv 5.74x before.

– (JP) Japan Chief Cabinet Sec Matsuno: Confirms Speculation of Minimum Wage Increase to ¥1.0K; Local understanding was important to restart the Shimane nuclear power plant, nuclear energy is important and must maximize its use.

– (JP) Net purchases of foreign bonds by Japanese investors: – 1.14 T ¥ against +627.0 B ¥ previously; Net foreign purchase of Japanese stocks: ¥0.9 billion vs. ¥4.1 billion previously.

– (JP) The Bank of Japan (BOJ) offers to buy 5 to 10 year JGBs at a fixed rate of 25 basis points; Opens a window to buy unlimited 10-year JGBs at 0.25% [as expected].

– (JP) Japan Dep Fin Min: Fiscal policy should not assume that the BOJ will buy bonds forever.

Korea

– Kospi opened -0.6%

– (KR) Bank of Korea (BOK) Gov Rhee: Accommodative Policy May Not Work Next Time for Emerging Markets – Bank of Korea International Conference.

– (KR) South Korea’s May manufacturing PMI: 51.8 vs. 52.1 before (20th consecutive expansion).

– (KR) Bank of Korea sells 1.9 KRW vs. 2.30 KRW shown in the 2-year Currency Stabilization Bonds (MSB) at 2.910%.

China/Hong Kong

– Hang Seng opened -1.1%; Shanghai Composite opened -0.5%.

– (CN) China says it has ordered public policy banks to establish an 800 billion yuan (~$120 billion) line of credit for infrastructure projects – press.

– (CN) China PBOC Open Market Operation (OMO): sells CNY10 B in 7-day reverse repos against CNY10 B previously; Net CNY0B against Net CNY0B before.

– (CN) The Chinese PBOC sets the reference rate for the yuan: 6.7095 against 6.6651 previously.

– (CN) US Customs official says ready to implement ban on imports from China’s Xinjiang region, very high standard of proof would be required for exemption – press.

– (CN) Car sales growth in China is expected to rebound to 4% in 2022; notes the impact of subsidies – China Securities Journal.

– (CN) China’s Finance Minister Liu Kun: China Will Make Full Use of Fiscal Tools to Meet Peak Carbon Emissions Targets, Then Go Neutral – Economic Daily Op-Ed.

– (CN) China Assistant Fin Min Ou Wenhan: China sold 2.03 T CNY of special local bonds from January to May; ~8.7 million passenger cars could benefit from a purchase tax reduction.

North America

– (United States) Weekly inventories of API crude oil: -1.2m vs. +0.6m previously.

– (US) National Security Advisor Sloat: expect more security assistance from Ukraine in the foreseeable future; The United States is not relaxing the implementation of sanctions.

Europe

– (HER) Saudi Arabia reportedly aims to pump more oil if Russian production drops – FT.

– (UK) Former BoE inflation hawk Sentance says the Bank of England needs to aggressively accelerate the pace of its monetary tightening, the BOE is expected to raise interest rates to 3% in 2023 [versus 1.00% currently] – British press.

– (TR) Turkey is appointing new ambassadors to Finland and Sweden.

Levels starting at 1:20 a.m. ET

– Nikkei 225, -0.3%, ASX 200 -1.1%, Hang Seng -1.8%; Shanghai Composite +0.1%; Kospi -1.1%.

– S&P500 equity futures: -0.1%; Nasdaq100 -0.1%, Dax flat; FTSE100 closed.

– €1.0659-1.0644; JPY130.23-129.88; AU$0.7186-0.7153; NZ$0.6491-0.6467.

– Gold -0.1% at $1,847/oz; Crude Oil -2% to $112.94/brl; Copper -0.4% to $4.3095/lb.