June S&P 500 E-Mini futures (ESM25) are down -0.35%, and June Nasdaq 100 E-Mini futures (NQM25) are down -0.30% this morning as concerns around U.S. trade policy and escalating geopolitical tensions weighed on sentiment, while investors awaited the release of crucial producer inflation data.

U.S. President Donald Trump heightened trade uncertainty with comments that he plans to impose unilateral tariffs on dozens of U.S. trading partners within two weeks. “We’re going to be sending letters out in about a week and a half, two weeks, to countries telling them what the deal is, like I did with the EU,” Trump said late Wednesday.

An escalation of tensions in the Middle East also weighed on investors’ risk appetite. CBS reported that U.S. officials have been told Israel is fully prepared to launch an operation into Iran, prompting the U.S. to evacuate non-essential embassy staff from Iraq. Iran threatened to strike not only Israeli targets but also U.S. bases in the region if attacked.

In yesterday’s trading session, Wall Street’s major indices closed lower. Most of the Magnificent Seven stocks retreated, with Amazon.com (AMZN) falling more than -2% and Apple (AAPL) dropping over -1%. Also, U.S. steel stocks slumped after the U.S. and Mexico closed in on a deal to remove tariffs on some steel imports, with Cleveland-Cliffs (CLF) sliding more than -8% and Nucor (NUE) dropping over -6%. In addition, Lockheed Martin (LMT) fell more than -4% after the U.S. Air Force reduced its F-35 aircraft request to Congress by half. On the bullish side, Warner Bros. Discovery (WBD) climbed +5% and was the top percentage gainer on the S&P 500 and Nasdaq 100 after it said it may repurchase more of its bonds than the $14.6 billion announced for buyback on Monday.

The U.S. Bureau of Labor Statistics report released on Wednesday showed that consumer prices rose +0.1% m/m in May, weaker than expectations of +0.2% m/m. On an annual basis, headline inflation picked up to +2.4% in May from +2.3% in April, weaker than expectations of +2.5%. Also, the core CPI, which excludes volatile food and fuel prices, rose +0.1% m/m and +2.8% y/y in May, weaker than expectations of +0.3% m/m and +2.9% y/y.

“The tariffs aren’t filtering through to Main Street as feared. This is good news for the White House, Wall Street, and Jerome Powell. The Fed’s tone could soften next week because we’ve probably seen peak hawkishness, especially with other central banks cutting,” said David Russell at TradeStation.

Meanwhile, U.S. rate futures have priced in a 100% chance of no rate change at next week’s FOMC meeting. Money markets are currently pricing in roughly two Fed rate cuts by the end of 2025, with the first anticipated in October.

Today, all eyes are focused on the U.S. Producer Price Index, which is set to be released in a couple of hours. Economists, on average, forecast that the U.S. May PPI will stand at +0.2% m/m and +2.6% y/y, compared to the previous figures of -0.5% m/m and +2.4% y/y.

The U.S. Core PPI will also be closely monitored today. Economists expect May figures to be +0.3% m/m and +3.1% y/y, compared to April’s numbers of -0.4% m/m and +3.1% y/y.

U.S. Initial Jobless Claims data will be released today as well. Economists estimate this figure will come in at 242K, compared to 247K last week.

On the earnings front, Photoshop maker Adobe (ADBE) is set to report its FQ2 earnings results today.

In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.402%, down -0.20%.

The Euro Stoxx 50 Index is down -1.15% this morning as heightened trade tensions and geopolitical unease dampened sentiment. Travel and mining stocks led the declines on Thursday. U.S. President Donald Trump said he plans to impose unilateral tariffs on dozens of U.S. trading partners in the coming weeks. Also, U.S. Commerce Secretary Howard Lutnick said the European Union will likely be one of the last deals the U.S. finalizes. Geopolitical worries added to the downbeat mood after CBS reported that U.S. officials have been informed Israel is fully prepared to launch an operation into Iran. Meanwhile, European Central Bank Governing Council member Gediminas Simkus advocated for a pause in interest rate cuts, pointing to “very big uncertainty” surrounding U.S. tariff policy. On the economic front, data from the Office for National Statistics showed that the U.K. economy shrank more than expected in April as Trump’s shifting trade policy curtailed an unexpected surge in activity. In other news, two economic institutes said on Thursday that the German economy is projected to expand this year after two straight years of contraction, lifting their forecasts for 2025 and 2026. In corporate news, BE Semiconductor Industries N.V. (BESI.NA) climbed over +5% after boosting its long-term financial targets.

U.K.’s GDP, U.K.’s Industrial Production, and U.K.’s Manufacturing Production data were released today.

U.K. April GDP has been reported at -0.3% m/m, weaker than expectations of -0.1% m/m.

U.K. April Industrial Production came in at -0.6% m/m and -0.3% y/y, weaker than expectations of -0.4% m/m and -0.2% y/y.

U.K. April Manufacturing Production stood at -0.9% m/m and +0.4% y/y, compared to expectations of -0.8% m/m and +0.4% y/y.

Asian stock markets today closed mixed. China’s Shanghai Composite Index (SHCOMP) closed up +0.01%, and Japan’s Nikkei 225 Stock Index (NIK) closed down -0.65%. 

China’s Shanghai Composite Index closed just above the flatline today as uncertainty surrounding U.S.-China trade relations persisted. Technology stocks led the declines on Thursday. Earlier this week, the U.S. and China agreed on a framework to ease trade tensions. Under the agreement, Beijing will remove export restrictions on rare earth minerals while the U.S. will reinstate access for Chinese students to its universities, U.S. President Trump said on Truth Social. Trump on Wednesday declared the deal “done,” and Commerce Secretary Howard Lutnick stated that tariffs on Chinese goods would remain capped at the current 55%. China on Thursday confirmed the trade deal announced by U.S. President Trump, stating that both sides must adhere to the consensus and emphasizing that China always honors its commitments. Still, the specifics of the deal and the details regarding its implementation remain unclear. Also, analysts pointed out that the talks failed to address key issues such as chip exports, suggesting that conflicts are likely to resurface in the future, while the duration of the current truce remains uncertain. Jason Chan, senior investment strategist at Bank of East Asia, Hong Kong, said, “We still don’t know if what Trump says will actually happen. It’s disappointing that the tariff rates were not dialled down at all and tech curbs on China were not even mentioned.” In corporate news, Sino Biopharmaceutical soared over +19% in Hong Kong after the drugmaker announced that a major overseas licensing deal could be finalized soon.

Japan’s Nikkei 225 Stock Index closed lower today, snapping a 4-session winning streak after U.S. President Donald Trump said he would set unilateral tariff rates within two weeks. Automobile stocks fell on Thursday as the Japanese yen strengthened on haven demand, with its appeal boosted by Trump’s tariff comments and rising geopolitical tensions. Electronics stocks also lost ground. Still, some investors view Trump’s latest remarks as an attempt to ramp up urgency in talks. The U.S. president made a similar pledge on May 16th but did not follow through on the threat. Meanwhile, a government survey released on Thursday revealed that Japan’s business sentiment deteriorated in the second quarter, indicating that uncertainty surrounding U.S. tariff policy is weighing on the country’s export-driven economy. The Nikkei business daily reported earlier this week that Japan’s tariff negotiator, Ryosei Akazawa, will travel to the U.S. for his sixth round of tariff negotiations and to Canada from this Friday through June 18th, as the Japanese government aims to finalize a trade deal on the sidelines of the Group of Seven summit. In other news, data from the Ministry of Finance showed a 10-week streak of foreign inflows into Japanese stocks, with 180.2 billion yen ($1.25 billion) coming in during the week ending June 7th. In corporate news, Nintendo rose over +1% after the game maker announced it had sold more than 3.5 million Switch 2 units within the first four days of its launch. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed up +3.16% to 23.52.

The Japanese BSI Large Manufacturing Conditions Index stood at -4.8 in the second quarter, weaker than expectations of 0.8.

Pre-Market U.S. Stock Movers

Boeing (BA) slumped over -7% in pre-market trading after the company’s 787 aircraft operated by Air India carrying more than 200 people crashed near the airport in Ahmedabad, a city in western India.

Oxford Industries (OXM) plunged more than -13% in pre-market trading after the owner of the Tommy Bahama and Lilly Pulitzer brands cut its full-year adjusted EPS guidance.

GameStop (GME) tumbled over -13% in pre-market trading after the videogame retailer announced plans to offer $1.75 billion worth of convertible notes.

Oracle (ORCL) climbed over +7% in pre-market trading after the IT giant posted better-than-expected FQ4 results and raised its full-year revenue guidance.

Datadog (DDOG) rose more than +1% in pre-market trading after Wolfe Research upgraded the stock to Outperform from Peer Perform with a $150 price target.

You can see more pre-market stock movers here

Today’s U.S. Earnings Spotlight: Thursday - June 12th

Adobe (ADBE), RH (RH), Yirendai Ltd (YRD), Americas Car-Mart (CRMT), Nano Dimension (NNDM), Lovesac (LOVE), Hooker Furniture (HOFT), Zedge (ZDGE).

On the date of publication, Oleksandr Pylypenko did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.