Stock Market Update

Equity futures point to a flattish opening this morning as investors monitor mostly optimistic updates on negotiations between the U.S. and Iran coming off the long holiday weekend. The two sides signed a 60-day memorandum of understanding in the previous week, pushing oil prices sharply lower and helping the major averages recover from a post-FOMC meeting selloff to finish higher for the week.

The FOMC kept rates unchanged, but struck a hawkish tone, which bumped up the market's expectations and timeline of a rate hike. Inflation readings will come fully into focus later in the week with Thursday's release of the May Personal Income and Spending Report, which includes the PCE Price Index (Briefing.com consensus 0.4%), the Fed's preferred inflation gauge.

Meanwhile, economic data is on the lighter side today.

Earnings will be lighter throughout the week, with just a handful of S&P 500 names set to report. There is a mega-cap tech/AI component to this week's earnings with Micron (MU 1,182.32 +48.33, +4.3%) set to report Wednesday afternoon.

In corporate news:

• AbbVie (ABBV 219.91, +3.42, +1.6%) and Apogee Therapeutics (APGE 133.13, +42.75, +47.3%) enter into a definitive agreement under which AbbVie will acquire Apogee for $135.11 per share in cash.
• Alphabet (GOOG 360.99, -6.47, -1.8%) had a top AI researcher leave the company to join Anthropic, according to Reuters.

Equity indices in the Asia-Pacific region started the week on a mostly higher note with Japan's Nikkei (+1.6%) and South Korea's Kospi (+0.7%) settling at fresh records. Japan's Nikkei: +1.6%, Hong Kong's Hang Seng: -0.7%, China's Shanghai Composite: +1.8%, India's Sensex: +0.4%, South Korea's Kospi: +0.7%, Australia's ASX All Ordinaries: -0.2%.

In news:

• Reports from China suggest that consumer demand was a little light on Friday, which was the country's second-largest shopping festival of the year.
• The People's Bank of China left its one-year and five-year loan prime rates at their respective 3.50% and 5.00%.
• Nikkei reported that Japan plans to invest JPY10.5 trln in AI-related projects by 2040.
• Expectations for another rate hike from the Bank of Japan are on the rise, with the market growing confident that the increase will be announced no later than October.

In economic data:

• China's May FDI -8.6% YTD (last -10.3%) o New Zealand's May Credit Card Spending 5.1% yr/yr (last 3.1%)

Major European indices trade in mixed fashion. STOXX Europe 600: +0.2%, Germany's DAX: -0.1%, U.K.'s FTSE 100: +0.5%, France's CAC 40: -0.4%, Italy's FTSE MIB: -0.4%, Spain's IBEX 35: +0.6%.

In news:

• Disgraced British Prime Minister Starmer finally announced his resignation earlier today.
• There is a high likelihood that Greater Manchester Mayor Burnham will run to become the next leader of the Labour party, which would also make him the seventh prime minister in the past ten years.
• Discount carrier EasyJet rejected three takeover offers from a U.S. investor.

In economic data:

• Switzerland's May M3 Money Supply CHF1.23 trln (last CHF1.23 trln)