TL;DR

US doubles China steel tariffs; global equities, oil rise; ECB eyes rate cut as trade risks mount.

Highlights

• US-China trade truce falters: both sides accuse each other of breaching Geneva deal; US doubles steel tariffs to 50% and imposes new tech export controls; China warns of "forceful measures."12
• Global equities, including Dow futures and Asian indices, fall on renewed tariff escalation and geopolitical tensions.215
• Indian Sensex drops 800 points, Nifty below 24,600, led by steep declines in metals and IT after US tariff move; foreign investors net sellers.14
• OPEC+ raises oil output less than expected; Brent and WTI rise as Ukraine-Russia conflict and Iran nuclear talks drive supply concerns.56
• Russia-Ukraine conflict intensifies with major drone/missile strikes and confirmed North Korean military support; Istanbul peace talks scheduled.3420
• US Senate proposes 500% tariff on Russian oil/gas, threatening India’s $50B Russian crude imports and Europe’s refined product flows.8
• Bank of Japan sets 100% provision for $198B in bond losses as yields climb; New World delays bond payments, highlighting China property sector risks.713
• ECB expected to cut deposit rate to 2% on June 5; Fed signals possible 2025 rate cuts if inflation and tariffs stabilize.16
• Morgan Stanley forecasts US Dollar Index to fall 9% by mid-2026 on Fed rate cuts; USD shorts build.18
• EU to restrict Chinese medical device firms from public contracts, increasing regulatory scrutiny.9
• Sanofi to acquire Blueprint Medicines for $9.1B; OpenAI acquires Jony Ive’s AI startup for $6.5B.1112
• Metaplanet adds 1,088 Bitcoin ($117M), now holding 8,888 BTC; Bitcoin above $105,000.19

Commentary

Markets are under pressure as US-China trade tensions escalate, with both sides accusing each other of breaching the recent Geneva truce. The US move to double steel tariffs and impose new tech export restrictions has triggered a sharp selloff in global equities, particularly in Asia and India, where metals and IT stocks led declines. The risk-off sentiment is further reflected in rising volatility and safe-haven flows.121415

Commodities are in focus. Oil prices are climbing despite OPEC+ announcing a modest output increase, as supply concerns persist amid intensified Russia-Ukraine hostilities and Iran signaling rejection of US nuclear proposals. The US Senate’s proposed 500% tariff on Russian oil and gas could disrupt major flows to India and Europe, adding to energy market volatility.568

Credit risks remain elevated in Asia. The Bank of Japan’s full provisioning for bond losses underscores the impact of higher yields on central bank balance sheets, while New World’s bond payment delay revives concerns over China’s property sector stability.713 Meanwhile, the ECB is expected to cut rates this week, and the Fed signals 2025 cuts are possible if inflation and tariff impacts moderate.16 Morgan Stanley ’s bearish USD outlook reflects expectations for US monetary easing and ongoing policy uncertainty.18

In corporate activity, Sanofi and OpenAI are driving notable M&A in biotech and AI, while institutional crypto adoption continues with Metaplanet ’s large Bitcoin purchase.111219 The EU’s move to restrict Chinese medical device firms highlights ongoing regulatory and trade friction with China.9

Traders should monitor developments in US-China and Russia-related trade policy, central bank decisions (especially the ECB on June 5), and commodity price action for short-term direction. Geopolitical and credit risks remain key drivers of cross-asset volatility.