Market Update
China's Four-Month Deflation Extends to May; Trade Surplus Widens Amid Cooler Export Growth
Li Chen
09 Jun, 2025
Hong Kong
Stocks in China and Hong Kong advanced on Monday, and investors reviewed the latest updates on international trade and inflation.
The Hang Seng Index increased 1%, and the CSI 300 index edged up 0.2%, and consumer and producer prices eased last month.
Consumer price inflation declined 0.1% in June, matching the decline in the previous month, the National Bureau of Statistics reported Monday.
Prices fell for the fourth consecutive month, driven by sluggish consumer demand and trade tensions with the United States.
Core inflation, which excludes volatile food and energy prices, rose 0.6%, driven by a 0.5% increase in service prices.
Producer price inflation decreased 3.3% in May, extending the deflationary trend to the 31st consecutive month.
The ongoing deflation is driven by a trend of weak consumer demand and falling automobile prices, as leading vehicle makers cut prices to attract buyers for electric vehicles.
China's exports rose at a slower pace in May amid simmering trade tensions with the U.S.
Exports increased 4.8% from a year ago in May to $316.1 billion, customs data showed on Monday.
Exports to the United States declined at a faster 34.5% compared to the 21% decline in the previous month, as importers held back amid constantly changing U.S. trade policy and import taxes.
However, shipments to ASEAN member nations soared 14.8%, amid strong demand for transshipments.
Imports declined 3.4% to $213 billion, faster than the 0.2% fall in the previous month.
China's trade surplus widened sharply to $103.2 billion, from $81.7 billion a year ago and from $96.2 billion in April.
Export and import outlook in the months ahead is highly uncertain, as the U.S. and China trade negotiation drags on with no clear agreement in the near future.
China's exports are likely to fall off in the second half, as U.S. businesses' frontloading will fade in the months ahead.
China Indexes and Stocks
The Hang Seng Index gained 1% to 24,030.93, and the CSI 300 index added 0.2% to 3,880.83.
Mainland China-based Midea Group and ZTO Express were added to the Hang Seng Index.
Midea Group Company declined 1.2% to HK $75.30, and ZTO Express Inc. added 4.5% to $139.90.
Toymaker Bloks and bubble tea retail chain operators Mixue and Guming were added to Stock Connect, facilitating cross-border investments.
Bloks Group soared 18.2% to HK $187.0, Mixue Group jumped 4.5% to HK $573.0, and Guming Holdings Ltd. added 2.6% to HK $27.20.
S&P 500 Rebounds After U.S. Payroll Growth Slowed In May but Surpassed Expectations
Barry Adams
06 Jun, 2025
New York City
Wall Street indexes advanced, and nonfarm payrolls advanced more than expected in May.
The S&P 500 index increased 0.2%, and the Nasdaq Composite rose 0.5%, and the labor market remained resilient despite the negative impact of Trump's import tax and macroeconomic uncertainty unleashed by the Trump administration.
On Thursday, the S&P 500 index declined 0.5%, and the tech-heavy Nasdaq Composite fell 0.8%, largely because of the 15% plunge in Tesla.
Tesla lost ground in Thursday's trading after the U.S. president suggested in a post on social media that the U.S. government should end subsidizing electric vehicles and several federal government contracts for space transport.
Tesla's chief executive, Elon Musk, acted as a private advisor to the U.S. president and reportedly financed the reelection of Donald Trump by as much as $300 million.
Commodities, Currencies, Indexes, Yields
The S&P 500 index increased 1.3% to 6,014.23, the Nasdaq Composite edged up 1.4% to 19,578.23, and the Russell 2000 index advanced 1.3% to 2,125.52.
The yield on 2-year Treasury notes edged higher to 4.00%, 10-year Treasury notes increased to 4.46%, and 30-year Treasury bonds advanced to 4.94%.
WTI crude oil increased $0.26 to $63.63 a barrel, and natural gas prices edged higher by $0.01 to $3.68 a thermal unit.
Gold increased by $5.17 to 3,358.22 an ounce, and silver edged up by $0.65 to $36.31.
The dollar index, which weighs the US currency against a basket of foreign currencies, increased by 0.46 to 99.20 and traded at the lowest level since April 2022.
U.S. Stock Movers
Lululemon Athletica Inc. plunged 21% to $264.05 after the specialty apparel retailer lowered its full-year outlook, citing macroeconomic uncertainty.
The company lowered its full-year earnings per share range to between $14.58 and $14.78 from the previous range between $14.95 and $15.15.
Several retailers have either withdrawn or lowered their annual outlook, citing Trump's import tax on consumers, including Abercrombie & Fitch, American Eagle Outfitters, RH, Macy's, and Gap Inc.
Walmart and Home Depot have signaled that consumers are likely to see higher prices as early as this month amid higher import taxes and the constantly changing trade policy of the Trump administration.
Broadcom Inc. decreased 2.5% to $253.38 after the advanced chipmaker's revenue modestly beat expectations set by analysts.
However, the company's revenue and earnings outlook in the current quarter fell short of market expectations.
DocuSign Inc. plunged 19.5% to $75.20, and the electronic signature and document processing company reported weaker-than-expected organic revenue growth in the latest quarter.
S&P 500 Rebounds After U.S. Payroll Growth Slowed In May but Surpassed Expectations
Barry Adams
06 Jun, 2025
New York City
Wall Street indexes advanced, and nonfarm payrolls advanced more than expected in May.
The S&P 500 index increased 0.2%, and the Nasdaq Composite rose 0.5%, and the labor market remained resilient despite the negative impact of Trump's import tax and macroeconomic uncertainty unleashed by the Trump administration.
On Thursday, the S&P 500 index declined 0.5%, and the tech-heavy Nasdaq Composite fell 0.8%, largely because of the 15% plunge in Tesla.
Tesla lost ground in Thursday's trading after the U.S. president suggested in a post on social media that the U.S. government should end subsidizing electric vehicles and several federal government contracts for space transport.
Tesla's chief executive, Elon Musk, acted as a private advisor to the U.S. president and reportedly financed the reelection of Donald Trump by as much as $300 million.
U.S. Stock Movers
Lululemon Athletica Inc. plunged 21% to $264.05 after the specialty apparel retailer lowered its full-year outlook, citing macroeconomic uncertainty.
The company lowered its full-year earnings per share range to between $14.58 and $14.78 from the previous range between $14.95 and $15.15.
Several retailers have either withdrawn or lowered their annual outlook, citing Trump's import tax on consumers, including Abercrombie & Fitch, American Eagle Outfitters, RH, Macy's, and Gap Inc.
Walmart and Home Depot have signaled that consumers are likely to see higher prices as early as this month amid higher import taxes and the constantly changing trade policy of the Trump administration.
Broadcom Inc. decreased 2.5% to $253.38 after the advanced chipmaker's revenue modestly beat expectations set by analysts.
However, the company's revenue and earnings outlook in the current quarter fell short of market expectations.
DocuSign Inc. plunged 19.5% to $75.20, and the electronic signature and document processing company reported weaker-than-expected organic revenue growth in the latest quarter.
U.S. Movers: Broadcom, Ciena, DocuSign, Lands’ End, Lululemon
Scott Peters
06 Jun, 2025
New York City
Broadcom Inc. dropped 4.2% to $249.00 despite the provider of semiconductor and infrastructure software solutions reporting higher earnings for its second quarter of fiscal 2025 ending on May 4.
Revenue edged up to $15.0 billion from $12.49 billion, net income jumped to $4.96 billion from $2.12 billion, and diluted earnings per share rose to $1.03 from 44 cents a year ago.
The company repurchased 25.3 million shares for $4.22 billion in the quarter.
In addition, Broadcom announced a quarterly cash dividend of 59 cents per share, payable on June 30 to shareholders on record on June 20.
The company guided third-quarter revenue to be approximately $15.8 billion, compared to $13.1 billion a year earlier.
DocuSign Inc. slumped 16.8% to $77.30 despite the e-signature software provider reporting strong results for the first quarter of fiscal 2026, ending on April 30.
Revenue jumped to $763.65 million from $709.64 million, net income edged up to $72.09 million from $33.76 million, and diluted earnings per share rose to 34 cents from 16 cents a year ago.
The company repurchased its own common stock worth $183.4 million, compared to $149.1 million in the previous year, and as of June 5, the company has up to $1.4 billion under stock repurchase authorization.
DocuSign guided second-quarter revenue to be between $777 million and $781 million, compared to $736 million a year earlier.
For the full year, the company estimated total sales to range between $3.15 billion and $3.16 billion, compared to $2.98 billion in the previous year.
Ciena Corp. eased 0.1% to $73.00 after the provider of networking systems reported results of its second quarter of fiscal 2025, ending on May 3.
Revenue increased to $1.12 billion from $910.83 million, net income swung to a profit of $8.97 million from a loss of $16.85 million, and diluted earnings per share swung to a profit of 6 cents from a loss of 12 cents a year ago.
Inventories totaled $874.3 million, compared to $1.02 billion a year earlier.
The company repurchased approximately 1.2 million shares for a total of $84.3 million during the quarter.
Lands’ End Inc. dropped 4.8% to $8.51 after the apparel and footwear retailer reported an expanding net loss for the first quarter of fiscal 2025, ending on May 2.
Revenue declined to $261.21 million from $285.47 million, net loss widened to $8.26 million from a loss of $6.44 million, and diluted loss per share expanded to 27 cents from a loss of 20 cents a year ago.
The company repurchased $2.8 million of its own stock during the quarter, and as of May 2, additional repurchases of up to $10.6 million remained under authorization through March 31, 2026.
The retailer guided full-year revenue to range between $1.33 billion and $1.45 billion, net income between $8.0 million and $20.0 million, and diluted earnings per share between 25 cents and 64 cents.
In comparison, fiscal 2024 revenue was $1.36 billion, net income was $6.23 million, and diluted earnings per share were 20 cents.
Lululemon Athletica Inc. plunged 22.4% to $256.78 after the apparel company reported lower earnings for its first quarter of fiscal 2025, ending on May 4.
Revenue climbed to $2.37 billion from $2.20 billion, net income fell to $314.57 million from $321.42 million, and diluted earnings per share rose to $2.60 from $2.54 a year ago because of a fewer outstanding shares.
Comparable sales increased 1% from a year earlier, as sales in the Americas decreased 1% and international sales edged up 7% on a constant dollar basis.
The company repurchased 1.4 million of its shares for a cost of $430.4 million in the quarter and added three new company-operated stores, ending with 770 stores.
Lululemon guided second-quarter revenue to be between $2.53 billion and $2.56 billion, an increase of 7% to 8% from $2.37 billion, and diluted earnings per share between $2.85 and $2.90, compared to $3.15 a year ago, respectively.
For the full year, the apparel retailer estimated revenue to range between $11.15 billion and $11.30 billion, representing growth of 5% to 7% from $10.59 billion, and diluted earnings per share between $14.58 and $14.78, compared to $14.64 a year earlier, respectively.
U.S. Movers: Broadcom, Ciena, DocuSign, Lands’ End
Scott Peters
06 Jun, 2025
New York City
Broadcom Inc. dropped 4.2% to $249.00 despite the provider of semiconductor and infrastructure software solutions reporting higher earnings for its second quarter of fiscal 2025 ending on May 4.
Revenue edged up to $15.0 billion from $12.49 billion, net income jumped to $4.96 billion from $2.12 billion, and diluted earnings per share rose to $1.03 from 44 cents a year ago.
The company repurchased 25.3 million shares for $4.22 billion in the quarter.
In addition, Broadcom announced a quarterly cash dividend of 59 cents per share, payable on June 30 to shareholders on record on June 20.
The company guided third-quarter revenue to be approximately $15.8 billion, compared to $13.1 billion a year earlier.
DocuSign Inc. slumped 16.8% to $77.30 despite the e-signature software provider reporting strong results for the first quarter of fiscal 2026, ending on April 30.
Revenue jumped to $763.65 million from $709.64 million, net income edged up to $72.09 million from $33.76 million, and diluted earnings per share rose to 34 cents from 16 cents a year ago.
The company repurchased its own common stock worth $183.4 million, compared to $149.1 million in the previous year, and as of June 5, the company has up to $1.4 billion under stock repurchase authorization.
DocuSign guided second-quarter revenue to be between $777 million and $781 million, compared to $736 million a year earlier.
For the full year, the company estimated total sales to range between $3.15 billion and $3.16 billion, compared to $2.98 billion in the previous year.
Ciena Corp. eased 0.1% to $73.00 after the provider of networking systems reported results of its second quarter of fiscal 2025, ending on May 3.
Revenue increased to $1.12 billion from $910.83 million, net income swung to a profit of $8.97 million from a loss of $16.85 million, and diluted earnings per share swung to a profit of 6 cents from a loss of 12 cents a year ago.
Inventories totaled $874.3 million, compared to $1.02 billion a year earlier.
The company repurchased approximately 1.2 million shares for a total of $84.3 million during the quarter.
Lands’ End Inc. dropped 4.8% to $8.51 after the apparel and footwear retailer reported an expanding net loss for the first quarter of fiscal 2025, ending on May 2.
Revenue declined to $261.21 million from $285.47 million, net loss widened to $8.26 million from a loss of $6.44 million, and diluted loss per share expanded to 27 cents from a loss of 20 cents a year ago.
The company repurchased $2.8 million of its own stock during the quarter, and as of May 2, additional repurchases of up to $10.6 million remained under authorization through March 31, 2026.
The retailer guided full-year revenue to range between $1.33 billion and $1.45 billion, net income between $8.0 million and $20.0 million, and diluted earnings per share between 25 cents and 64 cents.
In comparison, fiscal 2024 revenue was $1.36 billion, net income was $6.23 million, and diluted earnings per share were 20 cents.
Japan Indexes Struggled After Softer Household Spending In April
Akira Ito
06 Jun, 2025
Tokyo
Stock market indexes in Japan edged higher on Friday after the recent phone call between leaders of China and the U.S. failed to settle trade policy differences.
The Nikkei 225 Stock Average gained 0.5%, and the Topix index edged up 0.4% amid hopes that the U.S. and China will soon resume trade negotiations.
Investor sentiment was cautious after the latest household income and spending report confirmed weak consumer sentiment.
The average monthly income of a salaried household with at least two members rose 4.1% in nominal term and was unchanged in real terms from a year ago in April at 589,528 yen, the Ministry of Internal Affairs and Communications said.
Nominal household spending in April was 325,717 yen, or $2,300, an increase of 4% from a year ago, according to the data released by the ministry.
Household spending in real terms declined for the first time in two months, as consumers cut spending on appliances and apparel, partly because of rising prices.
Spending on appliances and furniture declined 0.4%, footwear and apparel fell 2.1%, but food spending increased for the first time in eight months by 0.3% amid elevated but stable prices.
Japan Indexes and Stocks
The Nikkei 225 Stock Average increased 0.5% to 37,741.61, and the broader Topix index gained 0.4% to 2,769.33.
Defense, steelmakers, vehicle makers, and heavy-industry companies dominated in Friday's trading.
IHI Corp. rose 2.4% to ¥15,550.0, Fujikura Ltd. increased 0.4% to ¥6,899.0, Nippon Steel Corp. advanced 1.7% to ¥2,900.0, and Toyota Motor Corp. gained 0.1% to ¥2,652.0.
Japan Indexes Struggled After Softer Household Spending In April
Akira Ito
06 Jun, 2025
Tokyo
Stock market indexes in Japan edged higher on Friday after the recent phone call between leaders of China and the U.S. failed to settle trade policy differences.
The Nikkei 225 Stock Average gained 0.5%, and the Topix index edged up 0.4% amid hopes that the U.S. and China will soon resume trade negotiations.
Investor sentiment was cautious after the latest household income and spending report confirmed weak consumer sentiment.
The average monthly income of a salaried household with at least two members rose 4.1% in nominal term and was unchanged in real terms from a year ago in April at 589,528 yen, the Ministry of Internal Affairs and Communications said.
Nominal household spending in April was 325,717 yen, or $2,300, an increase of 4% from a year ago, according to the data released by the ministry.
Household spending in real terms declined for the first time in two months, as consumers cut spending on appliances and apparel, partly because of rising prices.
Spending on appliances and furniture declined 0.4%, footwear and apparel fell 2.1%, but food spending increased for the first time in eight months by 0.3% amid elevated but stable prices.
Japan Indexes and Stocks
The Nikkei 225 Stock Average increased 0.5% to 37,741.61, and the broader Topix index gained 0.4% to 2,769.33.
Defense, steelmakers, vehicle makers, and heavy-industry companies dominated in Friday's trading.
IHI Corp. rose 2.4% to ¥15,550.0, Fujikura Ltd. increased 0.4% to ¥6,899.0, Nippon Steel Corp. advanced 1.7% to ¥2,900.0, and Toyota Motor Corp. gained 0.1% to ¥2,652.0.