Daily Market Reports | Jun 05 2025
This story features EAGERS AUTOMOTIVE LIMITED, and other companies. For more info SHARE ANALYSIS: APE
The company is included in ASX200, ASX300 and ALL-ORDS
European markets and the Nasdaq traded higher overnight. Yesterday, the ASX200 rallied to within 0.3% of its all-time-high set in January on softer-than-expected 1Q GDP growth. Australian futures are pointing to a flat to slightly weaker start.
| World Overnight | |||
| SPI Overnight | 8563.00 | – 2.00 | – 0.02% |
| S&P ASX 200 | 8541.80 | + 75.10 | 0.89% |
| S&P500 | 5970.81 | + 0.44 | 0.01% |
| Nasdaq Comp | 19460.49 | + 61.53 | 0.32% |
| DJIA | 42427.74 | – 91.90 | – 0.22% |
| S&P500 VIX | 17.61 | – 0.08 | – 0.45% |
| US 10-year yield | 4.37 | – 0.10 | – 2.13% |
| USD Index | 98.74 | – 0.50 | – 0.51% |
| FTSE100 | 8801.29 | + 14.27 | 0.16% |
| DAX30 | 24276.48 | + 184.86 | 0.77% |
Good Morning, US jobs and ISM data continues to signal slowing economic growth , with US Treasury yields slipping and investors buying BigTech growth companies again while rotating out of more cyclical stocks. Gold continued to find favour as the US dollar weakened,
What happened overnight: Extract from ANZ Bank Morning Focus
Equity markets were slightly firmer. The S&P500 rose 0.2%, the Euro Stoxx50 rose 0.5% and the FTSE100 rose 0.2%.
The yield on the US 10y note fell -9bps to 4.36%.
Oil weakened as WTI fell -0.8% to US$62.9/bbl. Gold rose 0.6% to US$3,372.4/oz.
May ADP jobs rose 37k versus market expectations of 114k. There has been a material slowing in this indicator, with the three-month average at 81k, down from 200k as recently as December.
Small establishments (1-49 people) lost -13k jobs, large establishments (250-plus people) lost -3k jobs and mid-sized firms (50-249 people employed) gained 49k.
The US ISM services index continued to lose momentum and fell -1.7pts to 49.9 in May, down on market expectations of 52.0. This saw the index dip below 50.0 for the first time since June last year. Among the subindices, business activity fell -3.7pts to 50.0, new orders fell -5.9pts to 46.4 and the backlog of orders fell -4.6pts to 43.4.
Demand indicators are flagging further weakness ahead. The prices index rose 3.6pts to 68.7, its highest level since November 2022 (69.4). Service sector activity accounts for 78% of US GDP.
The Bank of Canada left rates unchanged at 2.75%. This was the second consecutive meeting where policymakers held rates after a series of rate cuts.
Market pricing and most economists had anticipated no change in the cash rate.
Governor Macklem reported there was a consensus across the Governing Council to pause and assess the impacts of tariffs and that further reductions in the cash rate may be needed if the economy weakens.
Yesterday Australian GDP rose 0.2% QoQ in Q1 2025 to be 1.3% higher over the year. We think the economy is in better shape than 0.2% QoQ growth suggests.
Household income dynamics are showing an improvement, and we don’t think the fall in public demand that pulled growth down in Q1 marks the start of a new trend.
Hence, we don’t think the data will push the RBA to a July rate cut.
There has been discussion in market circles about the RBA having lowered its estimate of the neutral cash rate, but we don’t think it has.
If it had lowered its estimate of neutral and viewed such a change as material, it would have said so.
Our overriding impression is that the Board views neutral rate estimates as being subject to considerable uncertainty.
ANZ Bank overnight commodities update
Crude oil fell, after reports emerged that Saudi Arabia wants another major hike in output.
Eight members of the OPEC-Plus alliance agreed on Saturday to increase output by 411kb/d in July. It’s the third month in a row that the group has raised output more than its original agreement of 138kb/d.
Saudi Arabia is said to want to increase output at this level in August and possibly September to regain lost market share.
Sentiment wasn’t helped after Saudi Aramco cut its oil prices to Asia. While the decrease was smaller than anticipated, it suggests demand is soft despite entering the peak demand period.
The losses were contained by ongoing supply disruptions. Wildfires in Canada’s energy heartland of Alberta have shut down almost -350kb/d of heavy crude production.
Overall, there are blazes that are 10 hectares or larger in size that are within 10km of about 420kb/d of oil production.
The market is also concerned about renewed pressure on Iranian oil exports. Iran’s Supreme Leader, Ayatollah Ali Khamenei, said that it won’t give up its ability to enrich uranium on its own soil.
This was after President Trump said the US won’t allow any uranium enrichment as part of a nuclear deal with Iran.
North Asia LNG prices gained, following similar moves in Europe as forecasts of hot weather in the region raised the spectre of additional gas demand.
Above normal temperatures are expected across China and Japan, the two biggest buyers of LNG, over the next weeks. Buyers from these two countries have largely been on the sidelines of the spot market over the past few months.
However, higher air-conditioning requirements or reduced hydro output could boost gas needs. This could be countered by India, where utilities are relying on coal-fired power generation during the hottest periods this year.
Copper briefly touched a two-month high amid mounting supply side issues and declining inventories. Copper miner Teck Resources has reported production setbacks at two operations in Chile.
An incident at a northern Chilean port used by its Quebrada Blanca miner had taken the ship loader offline. It also suffered a mechanical issue at the mill of its Carmen de Andacollo mine in Chile’s northern central region. The issues are expected to persist for several months.
This comes after supply disruptions in the Democratic Republic of Congo. The Kamo-Kakula copper operation was impacted by seismic activity, which has resulted in flooding of the underground portion of the operation.
It’s expected to remain closed until Q4 2025. The impacted mine accounts for 70% of the complex’s current production.
The mine is the second largest in the world, with output expected to reach over 500kt in 2025. These issues, combined with robust demand, have reduced copper inventories on the London Metal Exchange nearly -75% this year.
Trump’s 50% tariffs on aluminium and steel have raised expectations that he will soon follow through with a pledge to impose stiffer duties on copper as well.
Gold rallied after weaker-than-expected US economic data raised expectations of a rate cut.
A contraction in US services activity and lower hiring have raised traders’ expectations of monetary loosening to avoid a recession.
Meanwhile, haven buying was prominent. US relations with China and the European Union continue to sour, with Trump doubling steel and aluminium tariffs to 50%
Is Powell Feeling the Heat? The View from Stephen Innes, SPI Asset Management
The “strong labour market” story just took a steel-toe boot to the ribs.
ADP delivered a faceplant, only 37k jobs added, the weakest print in two years, ripping the faade off the resilience narrative, and yanking labour surprise indices back to pre-election levels.
And if that wasn’t enough, ISM Services imploded too: new orders cratered while prices paid screamed to 30-month highs. The kind of stagflation-lite cocktail that makes even the most dovish central banker sweat.
Trump wasted no time lighting a fire under Powell, posting a social media tirade that read like a live-tweeted FOMC intervention.
The message was clear: cut nowor wear the blame. Combine that political heat with macro cold water, and the market did what it does best, front-run the Fed with a vengeance.
Treasury yields didn’t just slip, they got steamrolled.
A -9 to -11bps drop across the curve, with the long end taking the brunt. The 30Y once again rejected the psychological 5.00% line like a brick wall, and today’s move marks one of the largest single-day plunges in the past year and a half.
Overlay that with the Treasury Department’s buyback operations in the 2036-2045 window, and you’ve got the makings of a full-on curve revaluation.
The dollar? Cracked like a pane of glass under rate-cut weight, erasing yesterday’s bounce and closing at fresh cycle lows.
Gold, unsurprisingly, took flight, catapulting back toward US$3,380/oz as real yields dropped and the greenback buckled. The flight to hard assets is alive and well.
Equities, meanwhile, looked less convinced. The Nasdaq held its AI halo and closed higher, but the Dow and Small Caps rolled over, snapping the Dow’s four-day win streak.
The S&P flirted with the psychological 6,000 ceiling, but momentum stalled just shy of it, like a runner hitting oxygen debt at mile 25.
Under the hood, it was a tale of two tapes: the Magnificent 7 went vertical, while the other 493 names got left behind like bag-holders.
That bifurcation isn’t just anecdotal, it’s structural, as this rally is narrowing fast.
Mega-cap tech is dragging the entire index uphill, but breadth is deteriorating, and participation is thinning. Risk is getting top-heavy.
Volatility pulled back with VIX settling into a 17-handle, but don’t get lulled by the calm.
The vol curve’s whispering what traders already know: Friday’s NFP is the last real live wire before the summer lull sets in. After that, liquidity evaporates, narratives dull, and markets drift like sailboats waiting for wind.
Bottom line? Today was a shot across the bow. If Friday’s payrolls echo this weakness, rate-cut fever will hit full tilt, and the Fed’s “wait and see” posture might finally buckle under the weight of political pressure, market fragility, and a data tape that’s no longer cooperating.
Corporate news in Australia
-Eagers Automotive ((APE)) sells stake in McMillan Shakespeare ((MMS)) for $62m, reportedly funds for dealership acquisitions.
-ASIC is seeking to enforce increased disclosure of private credits deal details by 2025-end.
-National Storage REIT ((NSR)) has realised $140m from an asset sale to reduce debt.
-Coronado Resources ((CRN)) has secured a loan from Oaktree for $150m to shore up the balance sheet.
-Another $200m block of Sigma Healthcare ((SIG)) shares were sold from the Chemist Warehouse shareholders at $3.11 per share.
On the calendar today:
-AU April Household spending
-AU April Trade Bal
-JP April Earnings
-EZ April PPI
-EZ ECB Rates Decision
-US April Trade Bal
-US Beige Book
-US May ISM Services
-DOWNER EDI LIMITED ((DOW)) investor briefing
FNArena’s four-weekly calendar: https://fnarena.com/index.php/financial-news/calendar/
| Spot Metals,Minerals & Energy Futures | |||
| Gold (oz) | 3396.52 | + 19.30 | 0.57% |
| Silver (oz) | 34.67 | 0.00 | 0.00% |
| Copper (lb) | 4.90 | + 0.03 | 0.65% |
| Aluminium (lb) | 1.13 | + 0.01 | 0.69% |
| Nickel (lb) | 6.93 | + 0.04 | 0.52% |
| Zinc (lb) | 1.23 | – 0.00 | – 0.06% |
| West Texas Crude | 62.78 | – 0.63 | – 0.99% |
| Brent Crude | 64.83 | – 0.80 | – 1.22% |
| Iron Ore (t) | 96.26 | + 0.96 | 1.01% |
The Australian share market over the past thirty days
| Index | 04 Jun 2025 | Week To Date | Month To Date (Jun) | Quarter To Date (Apr-Jun) | Year To Date (2025) |
|---|---|---|---|---|---|
| S&P ASX 200 (ex-div) | 8541.80 | 1.27% | 1.27% | 8.90% | 4.69% |
| BROKER RECOMMENDATION CHANGES PAST THREE TRADING DAYS | |||
| APA | APA Group | Downgrade to Trim from Hold | Morgans |
| BKW | Brickworks | Downgrade to Hold from Accumulate | Ord Minnett |
| FPH | Fisher & Paykel Healthcare | Upgrade to Neutral from Sell | Citi |
| Upgrade to Overweight from Equal-weight | Morgan Stanley | ||
| GNC | GrainCorp | Downgrade to Neutral from Buy | UBS |
| IEL | IDP Education | Upgrade to Buy from Neutral | UBS |
| Downgrade to Equal-weight from Overweight | Morgan Stanley | ||
| Downgrade to Hold from Buy | Morgans | ||
| Downgrade to Hold from Buy | Ord Minnett | ||
| IFL | Insignia Financial | Upgrade to Buy from Neutral | UBS |
| JDO | Judo Capital | Upgrade to Outperform from Neutral | Macquarie |
For more detail go to FNArena’s Australian Broker Call Report, which is updated each morning, Mon-Fri.
All overnight and intraday prices, average prices, currency conversions and charts for stock indices, currencies, commodities, bonds, VIX and more available on the FNArena website. Click here. (Subscribers can access prices on the website.)
(Readers should note that all commentary, observations, names and calculations are provided for informative and educational purposes only. Investors should always consult with their licensed investment advisor first, before making any decisions. All views expressed are the author’s and not by association FNArena’s – see disclaimer on the website)
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CHARTS
For more info SHARE ANALYSIS: APE - EAGERS AUTOMOTIVE LIMITED
For more info SHARE ANALYSIS: CRN - CORONADO GLOBAL RESOURCES INC
For more info SHARE ANALYSIS: DOW - DOWNER EDI LIMITED
For more info SHARE ANALYSIS: MMS - MCMILLAN SHAKESPEARE LIMITED
For more info SHARE ANALYSIS: NSR - NATIONAL STORAGE REIT
For more info SHARE ANALYSIS: SIG - SIGMA HEALTHCARE LIMITED