TL;DR

OECD cuts U.S. growth outlook; Dollar General, Constellation surge; $60B tariff refund litigation looms.

Highlights

• OECD cuts 2025 global growth outlook to 2.9%; U.S. GDP forecast lowered to 1.6% on tariffs, tight labor, and higher rates; U.S. inflation seen at 3.2–4.0% in 2025.1
• Dollar General beats Q1 estimates, raises FY25 EPS and revenue guidance; stock up ~10% pre-market, expects to offset most tariff impact.3
• TSMC projects record 2025 profit on AI chip demand (24–26% revenue growth); notes limited direct tariff impact but warns of higher U.S. production costs.5
• Meta signs 20-year deal to buy 1.1 GW nuclear power from Constellation ’s Illinois plant; Constellation shares jump 15% pre-market.6
• Trump administration appeals court rulings against “Liberation Day” tariffs; $60B in potential tariff refunds at stake; key hearing June 5.7
• BOJ considers halting quarterly JGB purchase reductions as inflation stays below target; Japanese equity funds see record $12B outflow amid rising yields.89
• Eurozone inflation falls to 1.9% in May, below ECB target; markets expect ECB rate cut this week.16
• Coinbase discloses $400M data breach tied to Indian TaskUs agents, affecting 69,000+ customers; shares down 7% on legal and remediation costs.4
• Ukraine claims major damage to Crimean Bridge in underwater attack; Russia threatens retaliation; EU prepares new energy/banking sanctions on Russia.210
• Israeli forces kill 31, injure ~200 near U.S.-backed Rafah aid site; IDF investigating.11

Commentary

The OECD’s downgrade of U.S. growth to 1.6% for 2025, citing tariffs, labor constraints, and higher financing costs, sets a cautious tone for U.S. risk assets. Persistent inflation projections (3.2–4.0% for 2025) suggest the Fed will remain constrained, complicating the policy outlook and potentially weighing on rate-sensitive equities and fixed income.1 The Trump administration’s ongoing tariff litigation, with $60B in potential refunds and a key hearing this week, adds further policy uncertainty for U.S. importers and exporters.7

Despite the macro headwinds, select U.S. corporates are outperforming. Dollar General ’s strong Q1 and raised guidance highlight resilience in consumer staples, with management signaling confidence in mitigating current tariff impacts.3 In tech and utilities, TSMC ’s robust AI-driven outlook and Meta ’s 20-year nuclear power deal with Constellation (boosting CEG shares pre-market) underscore continued demand for AI infrastructure and reliable energy.56 These themes may provide relative strength in specific sectors even as broader indices face volatility.

Global central bank policy remains a key driver. The BOJ is considering a pause in bond purchase reductions as Japanese yields rise and equity funds see record outflows,89 while the ECB is widely expected to cut rates this week after eurozone inflation dropped below target.16 U.S. Treasuries may see safe-haven flows amid global growth concerns, but the backdrop remains unsettled by trade and legal risks.

Geopolitical risk is elevated, with Ukraine’s attack on the Crimean Bridge and subsequent Russian threats,218 new EU sanctions targeting Russian energy and banking,10 and ongoing violence in Gaza.11 These developments may keep energy and defense names in focus, while Coinbase ’s $400M data breach highlights persistent operational and legal risk in crypto and fintech.4