The S&P 500 Index ($SPX) (SPY) on Monday rose +0.36%, the Dow Jones Industrial Average ($ DOWI) (DIA) rose +0.14%, and the Nasdaq 100 Index ($ IUXX) (QQQ) rose +0.66%. June E-mini S&P futures (ESM26) rose 0.32%, while June E-mini Nasdaq futures (NQM26) rose 0.61%.
Stock indexes ended the day higher, recovering from early losses related to Iran’s suspension of US-Iran ceasefire talks. Oil prices rose as much as +8% earlier in the day and stocks fell after Iran’s Tasnim news agency reported that the Iranian government said in a statement that it had suspended the exchange of messages with the US regarding a cease-fire agreement due to Israel’s excessive aggression in Lebanon. Iran has been saying that there will be no end to the US-Iran without a deal in Lebanon.
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However, renewed hopes of a ceasefire emerged later in the day after President Trump said he had spoken with Hezbollah officials and Israeli Prime Minister Netanyahu, and that both sides told him they would agree to cease attacks. Mr. Trump then said in a post that “negotiations are continuing, at an accelerated pace” with Iran. Crude oil prices still closed the day above +5%.
Tech stocks saw support as Nvidia rallied more than +5% after it said it will enter the PC market with a new chip aimed at PCs looking to beat Intel and AMD. In addition, software stocks did well, with Microsoft rising more than +2%, after Nvidia’s CEO eased concerns about AI disruption.
Stocks also saw support after the May US manufacturing PMI rose +1.3 points to 54.0, stronger than expectations for a rise of +0.3 points to 53.0. However, the final S&P PMI for May was revised down -0.2 points to 55.1 from the first report of 55.3, compared to expectations for an unrevised report. On a positive inflation note, the May ISM index of prices fell -2.5 points to 82.1 from 84.6, weaker than expectations for a rise of +0.4 points to 85.0.
Markets are looking ahead to Friday’s US unemployment report, which is expected to show an unchanged unemployment rate of +4.3% and an increase in wages of +89,000.
Markets are discounting a 5% chance of a +25 bp FOMC rate hike at the next FOMC meeting on June 16-17.
The Q1 earnings season is generally over. As of last Friday, 84% of the 485 S&P 500 companies that reported Q1 earnings beat estimates. Q1 S&P 500 earnings are expected to rise +12% year over year, according to Bloomberg Intelligence. Stripping out the tech sector, Q1 earnings are expected to rise around +3%, the weakest figure in two years.
International stock markets closed mixed on Monday. The Euro Stoxx 50 closed -0.26%. China’s Shanghai Composite closed -0.27%. Japan’s Nikkei Stock Average hit a new record high and closed up +0.91%.
Interest rates
June 10-year T-notes (ZNM6) fell -3.5 ticks, and the 10-year T-note yield rose +2.4 bp to 4.459%. T-note prices were lowered due to Monday’s rally of more than +5% in crude oil prices, which pushed the 10-year inflation expectations rate up +1.1 bp to 2.411%.
European government bond yields rose on Monday. The 10-year German Bund yield rose +6.5 bp to 3.003%. The UK 10-year yield rose +8.5 bp to 4.897%.
Swaps are discounting a 94% chance of a +25 bp ECB rate hike at its next policy meeting on June 11.
European government bond yields rose. The 10-year German bund yield rose +7.5 bp to 3.013%. The UK 10-year yield rose +8.6 bp to 4.898%.
Swaps are discounting a 94% chance of a +25 bp ECB rate hike at its next policy meeting on June 11.
US Stock Movers
Nvidia (NVDA) rallied more than +6% after it said it would enter the PC market with a new chip, leading to losses of -4.9% for PC-chip competitor Intel (INTC), -1.3% for Advanced Micro Devices (AMD), and -8.8% for Qualcomm (QCOM).
Microsoft (MSFT) rallied +2.3% after Nvidia’s CEO downplayed concerns that AI will significantly disrupt the software industry.
Taylor Morrison Home Corp (TMHC) gained +22% after news of its nearly $8.5 billion acquisition by Berkshire Hathaway, the first acquisition by Berkshire’s new CEO Greg Abel.
Strategy (MSTR) fell -5.8% after the regulatory filing that shows the company sold 32 Bitcoins for $2.5 million, with an average sales volume of 77,135.
MGM Resorts (MGM) rose 17% after DealBook reported that Barry Diller’s People Inc would offer to buy the entire company for $18 billion.
Earnings Reports(6/2/2026)
Dollar General Corp (DG), Donaldson Co Inc (DCI), Palo Alto Networks Inc (PANW), Gitlab Inc (GTLB), Ulta Beauty Inc (ULTA).
As of the date of publication, Rich Asplund did not have (directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is for informational purposes only. This article was originally published on Barchart.com
