Weekly Market Summary: 2 to 7 June 2025

1. US Markets Advance on Jobs Data and Resilient Sentiment

US equity markets closed the week higher, with the S&P 500 crossing the 6,000 marks for the first time, ending at 6,000.36. The Nasdaq climbed 2.2% and the Dow Jones rose 1.2%. Investor sentiment was buoyed by the US May jobs report, which showed 139,000 jobs added—above expectations and a sign of ongoing economic resilience despite rising political noise.

President Trump added to market uncertainty with renewed calls for a 1% rate cut from the Federal Reserve. However, the Fed held rates steady, signalling no imminent change until later in the year.

2. ECB Delivers Another Rate Cut

The European Central Bank lowered its benchmark rate to 2%, marking its eighth rate cut in just over a year. The ECB cited weak growth and ongoing trade risks as rationale for the move, while signaling a cautious tone for future policy action. European equities responded positively, with the STOXX 600 gaining for a third straight day, aided by Germany's tax relief measures and tailwinds from Wall Street.

3. China Manufacturing Weakens as Trade Concerns Linger

China’s Caixin Manufacturing PMI fell to 48.3 in May, pointing to contraction and raising concerns over the sustainability of the post-COVID recovery. Trade negotiations between China and the US remain tense, with a temporary halt on reciprocal tariffs set to expire on July 9. The OECD also downgraded global growth projections to 2.9% for both 2025 and 2026, citing escalating geopolitical trade risks.

4. Singapore Market and Index Review

The Straits Times Index (STI) ended the week at 3,934, up 0.42% from the previous session. However, it experienced earlier softness on renewed concerns over US steel tariffs. FTSE Russell announced changes to the STI constituents following the June quarterly review, with Keppel DC REIT set to replace Jardine Cycle & Carriage.

5. Sector Highlights: Tech and Energy

Tesla shares came under pressure after President Trump threatened to terminate government contracts with the automaker amid a public dispute with Elon Musk. The stock dropped as much as 14% mid-week before recovering 3.7%. The broader tech sector remained firm, supported by solid economic data.

In commodities, oil prices rose 3.8% over the week, while gold gained 2.3% as investors sought safe havens amid ongoing global tensions and rate uncertainties.

6. Central Bank Snapshot

• Federal Reserve (US): Held interest rates unchanged. Markets do not expect any policy easing until Q4 2025.

• European Central Bank (ECB): Cut rates to 2%, citing weak growth.

• People’s Bank of China (PBOC): No major policy moves this week, but market eyes remain on potential stimulus in response to weakening industrial data.

  
  

7. Global Trade Developments

Global trade risks resurfaced with the looming expiration of the US-China tariff truce. The Trump administration's focus on reshaping trade relationships remains a market risk, and the OECD’s downgraded forecasts reflect the growing impact. A further escalation could weigh on industrial output and global demand.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Readers should perform their own due diligence before making financial decisions.