Memorial Day News Roundup - Newsquawk Asia-Pac Market Open

US stock markets were closed for Memorial Day. However, US equity futures saw strength on Monday and were buoyed by the gains out of Europe as sentiment was boosted after President Trump announced a delay to the 50% tariff deadline on EU goods to July 9th. Nonetheless, liquidity was thin and newsflow was very sparse given both US and UK markets were closed due to respective holidays.
USD traded flat with the DXY kept within narrow parameters (98.694-99.109) amid exceptionally light newsflow given the UK and US holiday closures. Nonetheless, DXY did slip onto a 98 handle for the first time since April 29th in the aftermath of US President Trump's decision to delay the 50% tariff deadline on EU goods to July 9th, while this week's macro US highlights come via FOMC minutes, the second reading of Q1 GDP and monthly PCE metrics.
Looking ahead, highlights include UK BRC Shop Price Index, Japanese Services PPI & Chinese Industrial Profits, Supply from Australia.

More Newsquawk in 2 steps:

1. Subscribe to the free premarket movers reports

2. Trial Newsquawk’s premium real-time audio news squawk box for 7 days

LOOKING AHEAD

Highlights include UK BRC Shop Price Index, Japanese Services PPI & Chinese Industrial Profits, Supply from Australia.
Click for the Newsquawk Week Ahead.

US TRADE

US stock markets were closed for Memorial Day. However, US equity futures saw strength on Monday and were buoyed by the gains out of Europe as sentiment was boosted after President Trump announced a delay to the 50% tariff deadline on EU goods to July 9th. Nonetheless, liquidity was thin and newsflow was very sparse given both US and UK markets were closed due to respective holidays.

TARIFFS/TRADE

US President Trump posted on Truth that "Countries from all over the World want to make TRADE DEALS with us. IT IS A BEAUTIFUL THING TO SEE. The Good Ol’ USA will soon have tremendous growth, and be stronger than ever before!!!"
EU plans to 'fast track' trade talks with US amid tariff fight and an EU Commission spokesman said the call between European Commission President von der Leyen and US President Trump has given new impetus to trade talks and they agreed both to fast track the trade negotiations and to stay in close contact".
European Trade Commissioner Sefcovic said he had a good call with US Commerce Secretary Lutnick on Monday and that the European Commission remains fully committed to constructive and focused efforts at pace towards an EU-US deal, while he added that they continue to stay in constant contact.
China's Customs is holding up some shipments of lower-performance rare earth magnets used in appliances and consumer electronics because of confusion over how to apply Beijing's export curbs, according to Reuters reports citing a source.
South Africa offered to import LNG from the US for 10 years as part of the deal proposed to Washington which would include the US investing in gas infrastructure and cooperating on technology and fracking, according to a ministerial statement.
FBN's Gasparino commented "After being delayed because of the India-Pakistan tensions, the trade framework with India and the White House is said to be almost complete" and "Remaining issues seem to be around Apple and its ability to move plants there from China as opposed to all of them in the US. Unclear if any of this will derail an announcement in the coming days. Developing".

FX

USD traded flat with the DXY kept within narrow parameters (98.694-99.109) amid exceptionally light newsflow given the UK and US holiday closures. Nonetheless, DXY did slip onto a 98 handle for the first time since April 29th in the aftermath of US President Trump's decision to delay the 50% tariff deadline on EU goods to July 9th, while this week's macro US highlights come via FOMC minutes, the second reading of Q1 GDP and monthly PCE metrics.
EUR was marginally firmer after news that President Trump delayed the 50% tariff deadline on EU goods to July 9th although had pared most of the gains during the early European morning and then proceeded sideways amid the thinned conditions, while it was later reported that European Trade Commissioner Sefcovic had a good call with US Commerce Secretary Lutnick on Monday and stated the European Commission remains fully committed to constructive and focused efforts at pace towards an EU-US deal.
GBP mildly gained but with upside in GBP/USD capped by resistance ahead of the 1.3600 level and with the world's FX trading hub closed for a bank holiday.
JPY was rangebound with trade in USD/JPY contained by resistance around the 143.00 level, while participants look ahead to Japanese Services PPI data.

COMMODITIES

The meeting of eight OPEC+ countries was brought forward to May 31st from June 1st, according to Reuters citing three sources.
Russian Deputy PM Novak said nothing has been discussed yet in response to a question about whether OPEC+ has discussed an oil output increase by another 411k bpd from July, and stated that OPEC+ will discuss the current market conditions and forecast, as well as make some adjustments if needed. Furthermore, Novak said the possible G7/EU tightening of Russia’s oil price cap is not acceptable and stated that price caps have not affected Russia’s oil exports, according to RIA.
Iraq's oil ministry sues Kurdistan regional government over new oil and gas contracts with US firms, while the new legal challenge reportedly complicates efforts to restart flows through the Iraq-Turkey oil pipeline.
Ecuador's biggest oil refinery experienced a fire, according to AFP citing the Energy Minister.
Petrobras (PBR) CEO said if oil prices drop further, they will cut diesel, gasoline, and jet fuel prices, while he added that fuel prices are at a 'comfortable level' and that gasoline and diesel prices are below parity at the moment.

CRYPTO

Trump Media & Technology (DJT) plans to raise USD 3bln to spend on cryptocurrencies, according to FT.

GEOPOLITICAL

MIDDLE EAST

Israeli PM Netanyahu said on Monday regarding hostage deal negotiations that he hopes they will have news regarding the hostages today or tomorrow.
Israel and Hamas were reportedly considering a new ceasefire document formulated by mediators including US Envoy Witkoff. It was separately reported that Hamas agreed to Witkoff’s proposal for a Gaza ceasefire, according to a Palestinian official close to the group cited by Reuters, while the proposal includes the release of 10 hostages in two groups and 70 days of truce with negotiations to continue during the truce to reach a permanent ceasefire upon US guarantees. However, Axios's Barak Ravid noted that White House Envoy Witkoff rejected Hamas' claims and said what he has heard so far from Hamas has been disappointing and completely unacceptable.
Israel rejected the new outline proposed by Hamas which it said was unacceptable and that Hamas adheres to its refusal. Furthermore, an Israeli source commented on what was raised about Hamas's approval of the Witkoff proposal and said each side agreed to a different proposal from the other, according to Sky News Arabia.
German Chancellor Merz said they will talk to Israel's PM Netanyahu this week to tell him not to take attacks on Gaza too far and stated that Israel's current level of attacks on Gaza can no longer be justified by the right against Hamas.
Iran’s President said Iran will survive even under more sanctions and no US talks, according to state media.
Iran’s Foreign Ministry reiterated that Iran will not accept temporarily suspending the uranium enrichment programme to secure a deal with the US. Furthermore, an Iranian Foreign Ministry spokesperson said the time and place for the next round of negotiations with the US have not yet been determined.

RUSSIA-UKRAINE

Russia's Kremlin said its strikes on Ukraine targeted military sites in retaliation for Ukrainian attacks on Russian civilian targets, while the Kremlin attributed US President Trump's remarks to "emotional overload" during a critical time. Furthermore, it stated that it expresses gratitude to Trump for helping launch Ukraine peace negotiations, despite his comment that Putin has gone "absolutely crazy".
Ukrainian President Zelensky said Russian mass attacks are Russian President Putin’s political choice and that Putin is playing with diplomacy, while he added that more pressure and sanctions must be applied on Russia.
Authorities in Ukraine’s Sumy region said Russian forces captured several villages in the region.
German Chancellor Merz said they are seeing daily encroachments and attacks on cybersecurity by Russia in the Baltic Sea region and noted that Ukraine now has long-range fire to target military infrastructure in Russia.

ASIA-PAC

NOTABLE HEADLINES

China raised the cross-border yuan use requirement for major banks, according to Bloomberg. China raised the minimum share of yuan in cross-border trade deals for major banks to 40% from 25%, aiming to boost global yuan use amid rising US tariffs and although not binding, failing to meet the threshold can affect banks’ regulatory scores and expansion prospects.
Moody's affirmed China's A1/A+ ratings; Outlook Negative and expects tariffs on Chinese exports to major markets will remain higher than at the beginning of the year. In relevant news, China’s Finance Ministry said the Moody's rating affirmation reflects some more positive trends in the Chinese economy, while it added that incremental and existing policies will firmly support economic development.
EU urged Shein to respect EU consumer protection laws and said the CPC network directed Shein to align practices with EU consumer laws in a CPC network action against Shein which is led by Belgium, France, Ireland and the Netherlands. Furthermore, it was reported that Shein has one month to respond to the CPC's findings and could face fines if it fails to address concerns.
Japan is planning to spend JPY 900bln in state funds for a US tariff emergency relief package and will tap into budget reserves and existing budgets to fund the package.

EU/UK