Can May Momentum Continue?
June 2, 2025
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Equity markets displayed impressive strength in May following an April that saw Liberation Day and tariffs spark substantial volatility. Global equities in May, as represented by the MSCI ACWI Index, had their strongest month since November of 2023.1 However, caution remains as President Trump raised further trade concerns, doubling tariffs on steel and aluminum imports last week.2 In addition to trade policy, negotiations among U.S. lawmakers on a broad-based tax and spending bill could add to the instability.
Meanwhile, Treasuries had their first monthly loss of 2025.3 Growing concerns surrounding U.S. budget deficits and debt levels have led to rather weak Treasury auctions in recent weeks.4 In an ominous warning, JPMorgan Chase Chief Executive Officer, Jamie Dimon, said on Friday that a “crack in the bond market” is going to happen.5
As the markets open this morning, European equity markets are slightly in the red,6 as are U.S. equity futures,7 indicating a continuation of May’s performance may be challenging out of the gates. This week’s economic data kicks off with the Institute for Supply Management (ISM) manufacturing report today.8 The main data focus will be on jobs numbers with the Job Openings and Labor Turnover Survey (JOLTS) on Tuesday, the May ADP employment change on Wednesday and May payroll numbers on Friday morning.9
Sources:
1,3Bloomberg
2,6CNBC – European autos stocks fall 2% as Trump’s 50% steel tariffs inflate EU trade tensions; 6/2/25
4CNBC – 30-year Treasury yield spikes to 5.09%, 10-year yield hits 4.61% as GOP bill raises deficit concerns; 5/21/25
5The Wall Street Journal – JPMorgan’s Jamie Dimon Predicts ‘Crack in the Bond Market,’ Citing U.S. Fiscal Mess; 5/30/25
7CNBC – Stock futures slide as global trade tensions rise to start the new month: Live updates; 6/2/25
8,9MarketWatch – U.S. Economic Calendar; as of 6/2/25
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