Morning News

Source: Wall Street News

 Market Overview

After a big rise the previous day, the upward trend of US stocks temporarily halted. Near the close, relevant news in the chip sector dragged the broader US stock market down rapidly, and finally several major stock indexes closed down across the board. Apple and Meta closed higher, while Tesla closed down 1.65%. Synopsys, a chip software design company, fell nearly 10%.

After the market, Nvidia's financial report once rose more than 5%, boosting the US stock index to rise after the market. After Salesforce's financial report, the stock price once rose more than 5%, and then the increase significantly retraced.

The 5-year US Treasury bond auction was brilliant, and the increase in US Treasury bond yields narrowed. The US dollar rose. Bitcoin dropped 2%, falling below yesterday's low price of $107,000.

Gold reversed in a V shape. OPEC+ maintained the current oil production quota plan, and the market focused on the July production increase matter over the weekend. Crude oil once rose more than 2%.

During the Asian session, AH stocks closed down collectively. The new consumption concept burst, auto stocks continued to be adjusted, Kuaishou closed up 6% after the results, and rebar hit a 9-month low.

### Highlights

Nvidia's Q1 revenue growth slowed to a two-year low of 69%, still higher than expected. It withstood the pressure of export restrictions. In Q2, the revenue of H20 is expected to decrease by $8 billion, and the total revenue meets expectations. Blackwell Ultra is expected to start shipping in Q2. Jensen Huang said that the Blackwell NVL72 AI supercomputer is fully operational; China is one of the largest AI markets. The stock price once rose 5% after the market.

It is reported that Tesla plans to launch the Robotaxi service in Austin, Texas on June 12.

The DeepSeek R1 model has completed a "small version trial upgrade", and its programming and logical understanding have reached a new level.

Trump put pressure again: Harvard University should set an upper limit of 15% on the number of international students, instead of the current 31%.

The Fed meeting minutes: Higher uncertainty calls for cautious interest rate cuts. Almost all members mentioned the inflation risk and reiterated the "difficult trade-off". The "new Fed news agency": Given the increased uncertainty of tariff policies, the Fed重申 the need for a "cautious attitude".

The 5-year US Treasury bond auction was brilliant, and overseas demand reached an all-time high. The result of Japan's 40-year Treasury bond auction was released. The bid-to-cover ratio was a new low since July 2024, but the result was better than last week's auction.

Nomura interpreted the US-Japan negotiations: Japan's position has not changed, and the US wants investment, especially in the shipbuilding industry. Paul Krugman "open letter" called on Europe: Stop flattering Trump. You can't make substantial concessions. Act like a big power.

OPEC+ maintained the current oil production quota plan, and the market focused on the meeting on May 31 to discuss the July production increase matter.

### Market Closing Report

- **European and American stock markets**: The Dow Jones Industrial Average fell 0.58%, the S&P 500 index fell 0.56%, and the NASDAQ fell 0.51%. The European STOXX 600 index closed down 0.61%.

- **A shares**: The Shanghai Composite Index fell 0.02%, the Shenzhen Component Index fell 0.26%, and the ChiNext Index fell 0.31%.

- **Bond market**: The yield on the 10-year benchmark US Treasury bond rose 3.37 basis points to 4.4773%. The yield on the two-year US Treasury bond rose 0.93 basis points to 3.9901%.

- **Commodities**: WTI July crude oil futures closed up 1.56% at $61.84 per barrel. Brent July crude oil futures closed up 1.26% at $64.90 per barrel. COMEX gold futures fell 0.26% to $3,291.80 per ounce.

### Global Highlights  
**Nvidia's Q1 Revenue Growth Slows to 69%, Still Beats Expectations**  
- Revenue growth hit a two-year low but exceeded analyst forecasts  
- EPS was 13% below expectations, but would have been 3% higher excluding H20 and tariff impacts  
- Gross margin fell to 61%, but remained above 70% excluding H20 effects  
- $4.5 billion in H20-related costs from export restrictions (lower than April's $5.5B estimate)  
- Q2 revenue guidance projects 50% growth despite $8B H20 revenue reduction  
- Blackwell Ultra chips to begin shipping in Q2  
- CEO Jensen Huang announced full production of Blackwell NVL72 AI supercomputers  
- China remains one of the largest AI markets  
- Shares rose 5% after hours  

**Tesla to Launch Robotaxi Service on June 12 in Austin**  
- Key milestone in Musk's autonomous vehicle strategy  
- Date subject to change but aligns with Musk's previous late-June target  

**DeepSeek R1 Model Upgraded**  
- Enhanced programming and logical reasoning capabilities  
- First update in two months  
- Market awaiting rumored R2 release  

**Trump Pressures Harvard on International Students**  
- Proposes capping foreign enrollment at 15% (down from 31%)  
- Has frozen $2.6B in federal research funding  
- Repeatedly calls for revoking Harvard's tax-exempt status  

**Fed Meeting Minutes Highlight Caution**  
- "Exceptionally high" economic uncertainty warrants careful rate cuts  
- Nearly all members cited persistent inflation risks  
- Noted shifting asset correlations in April markets  
- "Fed Whisperer" suggests tariffs may exacerbate inflation concerns  

**Bond Market Developments**  
- Strong 5-year Treasury auction with record foreign demand  
- Japan's 40-year bond auction saw weak bidding but better results than prior week  
- Nomura suggests Japan may cut long-term bond issuance to ease market pressure  

**Trade Negotiations**  
- Japan proposes buying $6.9B in U.S. chips to address trade imbalance  
- EU focuses trade strategy on metals, autos, pharma, semiconductors and aircraft  
- Nobel winner Krugman urges Europe to stand firm against Trump's trade threats  

**OPEC+ Maintains Output Quotas**  
- Focus shifts to June 1 meeting on potential July production increases  
- Oil prices rose over 2% intraday  

### Domestic Developments  
**Hong Kong Implements Global Minimum Tax**  
- Takes effect January 1, 2025  
- Aligns with OECD anti-tax-avoidance rules  

**Coal Prices Test 600 Yuan Threshold**  
- Hit five-year lows due to record production and high inventories  
- Analysts warn prices may fall further  

**Robotics and Rare Earths**  
- Morgan Stanley: Each humanoid robot requires 0.9kg rare earth metals  
- U.S. heavily dependent on Chinese rare earth supplies  

**Xiaomi Catalysts Ahead**  
- Investor day (June 3)  
- 6.18 shopping festival sales  
- YU7 EV launch (July)  

### Overseas Developments  
**Apple to Rename Software by Year**  
- Will switch to annual naming (e.g., iOS 18 → iOS 26)  
- Change to be announced at WWDC on June 9  

**AI Job Displacement Warning**  
- Anthropic CEO predicts AI could replace 50% of entry-level white-collar jobs in 1-5 years  
- Could push unemployment to 10-20%  

**Corporate Bitcoin Trend**  
- Over 100 public companies now hold ~800,000 BTC ($90B)  
- MicroStrategy's strategy inspiring similar moves  

### Sector Focus  
1. **Home Appliances**: Chinese firms entering global expansion phase  
2. **Chemicals**: Explosion at Shandong pesticide plant may disrupt supply  
3. **Aviation**: Structural imbalances creating opportunities  
4. **Aluminum**: Tight supply supports prices and dividends  

### Today's Calendar  
- U.S. Q1 GDP and core PCE data  
- Jobless claims  
- Fed speeches  
- Earnings: Costco, Dell, Marvell, Li Auto  
- EIA crude inventory report  

*Disclaimer: Views represent author's opinion only. Accuracy and completeness not guaranteed. Platform assumes no liability for investment decisions based on this information.*