Morning Wrap: ASX 200 futures flat, S&P 500 and Nasdaq hit record highs on US-China trade truce

ASX 200 futures are up 5pts (+0.05%) as of 8:30 am AEST.

In a nutshell:

• S&P 500 and Nasdaq both hit fresh record highs

• US and China confirmed a framework around May's Geneva talks, China to commit to rare earth exports while US to remove countermeasures

• Bessent signals flexibility on trade deadline, more deals to be announced in coming days with key trading partners

Let's dive in.

S&P 500 SESSION CHART

S&P 500 higher after a rally in the last hour of trade (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks finished broadly higher thanks to a sharp rally in the last hour of trade

• S&P 500 and Nasdaq both logged fresh record highs

• US weekly recap – Nasdaq (+6.07%), Russell 2000 (+5.14%), S&P 500 (+4.42%), Dow (+3.67%) 

• Today’s big story – Mixed trade developments, Trump said he is terminating trade talks with Canada in response to digital services taxes, US-China both confirmed a framework to allow for rare earth exports while the US removes countermeasures, Bessent said there are ten more trade deals to be announced

• High beta ETFs on track for best quarter since 2020 as investors favour momentum plays and speculative names (BBG)

• Taiwanese investor outflows from US bond ETFs on track for largest half-year exodus since 2020 (BBG)

• Best returns this year have gone to investors who bought Latin America and Eastern Europe (regional indices up 25% and 45% respectively), avoided Asia (BBG)

STOCKS

• Nike guides for a smaller-than-expected sales decline in current quarter, raising hopes for recovery, plans for "surgical" price increase to mitigate tariffs (BBG)

• Nvidia insiders have sold more than $1bn of stock over the past 12 months (FT)

• Meta reportedly hires four more key researchers from OpenAI (TC)

• PwC mulls layoffs in the UK and lower salary bumps amid a broader market slowdown (FT)

• Apple adjusts App Store rules, implementing a 20% processing fee following EU antitrust regulations (RT)

CENTRAL BANKS

• Majority of Fed officials lean against July interest rate cut (RT)

• Trump says he'll expect next Fed chair to cut rates (AX)

• Fed dot plot implies three rate cuts in 2026, but markets betting on more dovish rate path under Powell's successor (RT)

• ECB's Knot acknowledges likelihood of another 25bps cut by year-end (BBG)

TARIFFS 

• US and China have finalised a trade understanding reached last month in Geneva, includes China's commitment to deliver rare earths (BBG)

• China confirms trade framework details with the US, expects them to cancel restrictive measures taken against China (BBG)

• Trump says he's terminating trade talks with Canada over tax on tech firms (AP)

• French finance minister says he believes EU will secure trade deal with US before July 9 deadline (BBG)

• Taiwan said it's made "constructive progress" in a second round of trade talks with the US (BBG)

• EU and US believe they can reach a trade deal before 9-Jul, EU seeking mutually beneficial deal but also preparing countermeasures if talks fail (WSJ)

• Trump says 'very big' trade deal could be signed with India, opens up their market to American businesses (BBG)

GEOPOLITICS

• Trump says he would consider bombing Iran again, drops sanctions relief plan (RT)

• Iran says it doubts ceasefire with Israel will hold, warns against new strikes (TI)

• Iran's uranium stockpile intact, according to EU intelligence (FT)

ECONOMY

• US May core PCE up 0.2% month-on-month vs. consensus for a 0.1% increase, May personal spending down 0.1% vs. expectations for a 0.3% increase (BBG)

• China industrial profits unexpectedly dive 9.1%, attributed to "insufficient effective demand, falling prices of industrial products and short-term volatilities" (BBG)

• France and Spain inflation up 0.8% and 2.2% year-on-year respectively in June, but ECB remains optimistic about meeting 2% target (BBG)

• Tokyo core inflation slows for first time in four months, reflecting energy subsidies (BBG)

ASX TODAY

Be sure to check out our Live Blog for the latest coverage and analysis for company announcements, market movements and economic updates.

• Azek shareholders approve acquisition by James Hardie, transaction expected to close around 1-Jul (JHX)

• GenusPlus awarded $105m contract for Reeves Plains BESS Project Stage 1 (GNP)

• Motorcycle Holdings to acquire business assets of Peter Stevens and Harley Heaven for $7-9m cash, funded through cash reserves and facilities, expected to be earnings accretive (MTO)

• MinRes completes sale of iron ore operations and assets in Yilgarn region, terms undisclosed, retained all gold and lithium rights on tenements sold (MIN)

• WA1 Resources updates Luni Mineral Resource Estimate to 220Mt at 1.0% Nb, up 10% vs. prior resource estimate (WA1)

WHAT TO WATCH TODAY

• Gold: Gold prices tumbled 1.63% overnight, largely driven by positive trade developments. This drove the Gold Miners ETF (GDX) 3.5% lower to a near one-month low.

• Banks vs. Miners: Notable rotation last Friday, with banks down 1-2% (CBA down 2.2%) and iron ore miners up 3-4%. Will be interesting to see if this rotation persists.

BROKER MOVES

• Aussie Broadband initiated Outperform with $5.05 target (MQG)

• NiB Holdings upgraded to Buy from Neutral; target up to $7.85 from $7.35 (UBS)

• Superloop initiated Outperform with $3.25 target (MQG)

Key events Stocks trading ex-dividend: 

• Mon 30 Jun: Abacus Group (ABG) – $0.043, Abacus Storage King (ASK) – $0.031, Lowell Resources Fund (LRT) – $0.031, Metrics Income Opportunities Trust (MOT) – $0.014, Metrics Master Income Trust (MXT) – $0.012, Metrics Real Estate Multi-Strategy Fund (MRE) – $0.01, Ophir High Conviction Fund (OPH) – $0.199, Regal Investment Fund (RF1) – $0.07

• Tue 1 Jul: Ricegrowers (SGLLV) – $0.50

• Wed 2 Jul: Graincorp Ltd (GNC) – $0.24

• Thu 3 Jul: ALS (ALQ) – $0.197, Clime Capital (CAM) – $0.014

Other ASX corporate actions today: 

• Dividends paid: Tasmea (TEA), Transmetro Corp (TCO)

• Earnings: None

• IPOs: Tetratherix (TTX) at 11 am

• AGMs: None

Economic calendar (AEST):

• 11:30 am: China NBS Manufacturing and Services PIM (Jun)

• 10:00 pm: Germany Inflation (Jun)