EUROPEAN OPEN: AZN LN oral GLP-1 advances to Phase 3; GSK LN agrees USD 10.6bln NUVL acquisition; Germany seeks FCAS exit; ASML NA warns on EU chip supply-chain intervention; Italy neutral on BMPS IM proposals; PAI withdraws from NESN SW water auction

EUROPEAN OPEN:

• European equities have started mostly firmer after a rebound in APAC equities overnight, where the MSCI APAC Index was up almost 3.0%, while South Korea’s KOSPI rose as much as 8.5% as dip buyers returned to AI stocks following Monday’s sell-off. Indonesia’s central bank unexpectedly raised rates by 25bps to stabilise the rupiah currency amid Middle East volatility.
• Brent fell to around USD 93.20/bbl after Iran and Israel pledged to ease strikes, though the Strait of Hormuz still remains effectively closed by a dual US-Iranian blockade. President Trump yesterday said the US will declare “total victory” over Iran within two weeks, and reiterated that oil prices will fall once the conflict ends. Trump reportedly warned Israeli PM Netanyahu he could face Iran alone if escalation became war. Elsewhere, a top Iranian official told CNN that an imminent US-Iran deal was doubtful, citing major roadblocks over Iran’s nuclear programme and uranium enrichment.
• Gold ticked up to around USD 4,340/oz after Israel and Iran pledged to halt missile strikes following an appeal by President Trump for de-escalation. Copper fell on US rate hike expectations, while tech stock volatility dampened appetite for industrial metals.
• In data releases, China’s exports jumped 19.4% Y/Y in May (exp. 14.3%), the fastest pace in three months, while imports soared over 27.4% (exp. 25%), leaving a trade surplus of USD 105.4bln (exp. 91.5bln), the largest since January; shipments of computers and parts surged 66%, integrated circuit exports rose 111% (most since 2013), driven by global AI infrastructure demand. Exports to the US rose nearly 36%, the most since 2021.
• Germany’s trade surplus widened to EUR 14.5bln in April (exp. 14.2bln, prev. 14.3bln), with imports +1.2% M/M (prev. 5.1%), and exports +0.9% M/M (prev. 0.5%); seasonally adjusted exports reached EUR 79.1bln to EU states, and EUR 57.5bln to non-EU countries. German industrial production rose +0.4% M/M in April (exp. 0.5%, prev. -0.7%); production was 0.5% lower from February-April vs the prior three months.
• UK BRC Retail Sales Monitor rose to 3.4% Y/Y in May (exp. 0.6%, prev. -3.4%); BRC said May’s heatwave boosted outdoor and summer goods, clothing, footwear, fans, bedding, toys, food and online sales.
• Looking ahead, highlights include US weekly ADP jobs figures, US and Canadian trade data, US existing home sales, the EIA STEO; comments are due from ECB President Lagarde, though she is not expected to comment on monpol. Supply is due from the US, Germany and the Netherlands.

STOCK SPECIFICS:

• CHINA: The US Pentagon expanded its list of Chinese military-linked companies, adding about two dozen firms including Alibaba, Baidu, BYD, WuXi AppTec, Unitree, TP-Link, Yangtze Memory Technologies, ChangXin Memory Technologies and Hesai; the companies are barred from US military business; Alibaba and Baidu disputed the designations.
• HEALTHCARE: AstraZeneca (AZN LN) said oral GLP-1 elecoglipron 75mg cut body weight 10.5% at 26 weeks versus 0.6% placebo, with 11.8% at 36 weeks, advancing to Phase III. GSK (GSK LN) agreed to acquire Nuvalent (NUVL) for USD 10.6bln, a 40% premium, adding FDA-reviewed ROS1 and ALK inhibitors, both under FDA review with target decision dates of 18th September and 27th November 2026 respectively (peak sales potential estimated at USD 5-7bln by analysts at Jefferies), plus an early-stage HER2 inhibitor. Merck (MRK) and Gilead (GILD) discontinued Phase 3 KEYNOTE-D46/EVOKE-03 in previously untreated metastatic non-small cell lung cancer after progression-free survival missed significance and overall survival benefit was deemed unlikely.
• INDUSTRIALS: Of note for Airbus (AIR FP) and Dassault (AM FP), German Chancellor Merz told French President Macron that Germany wants to withdraw from plans to develop a joint fighter jet under the EUR 100bln FCAS programme, proposing instead to continue collaboration with Spain on the combat cloud component of the project. Of note for Airbus (EADSY) and Boeing (BA), Philippine Airlines is considering an order for up to 20 widebody jets to replace its older A330 and Boeing 777 fleet, with the Boeing 787 Dreamliner, Airbus A330neo, and A350 all reportedly under consideration.
• COMMUNICATIONS: Of note for Meta Platforms (META) and EssilorLuxottica (EL FP), European lawmakers and regulators are intensifying scrutiny of smart glasses over surveillance and privacy risks, with concerns that built-in cameras breach consent principles under European privacy regulations, as individuals captured by the devices have no meaningful way to object to their data being processed, Politico reports. Orange (ORA FP) acquired full ownership of Spain’s largest telecoms operator MasOrange, buying Lorca’s remaining 50% stake for EUR 4.25bln, after approvals.
• TECH: ASML (ASML NA) CEO warned against EU semiconductor supply-chain intervention, citing competitiveness, permitting, capital and AI rules; CEO added that ASML targets 50% higher EUV output, and investments beyond Mistral and Zeiss (AFX GY). Apple (AAPL) said it cannot currently launch its redesigned Siri AI on iPhones, Apple Watches, or iPads in the EU due to a standoff with regulators over the Digital Markets Act; it proposed an EU-specific solution that would limit the data virtual assistants could access to ensure DMA compliance while protecting user privacy, but said regulators have refused to engage. Apple shares fell just shy of 2% on Monday after its keynote at the WWDC 2026 event. Applied Digital (APLD) signed a 15yr take-or-pay Delta Forge 2 lease for 210 megawatts, expected to generate USD 5.2bln, or USD 12.7bln with renewals.
• FINANCIALS: The Italian government is reportedly neutral on M&A moves targeting BMPS (BMPS IM), after Intesa Sanpaolo (ISP IM) and Banco BPM (BAMI IM) submitted proposals, Reuters reports. Swiss lawmakers are considering a UBS Group (UBSG SW) capital compromise requiring 70-80% CET1 backing for foreign units, reducing extra burden to about USD 15bln from USD 20bln, Bloomberg said.
• CONSUMER: PAI Partners reportedly withdrew from bidding for Nestle’s (NESN SW) water business, despite being the company’s long-term private equity partner, Bloomberg reports. Stellantis (STLAM IM) is recalling over 1.3mln Jeep SUVs and trucks over fire concerns.
• ENERGY: BP (BP/ LN) investors and former executives have reportedly expressed concern that the company may lose restructuring momentum after former CEO Manifold’s firing, with shareholders seeking clarity.
• BROKER UPDATES: Publicis (PUB FP) and WPP (WPP LN) were initiated with Buy ratings at Berenberg; Givaudan (GIVN SW) was upgraded at Deutsche Bank; Boliden (BOL SS) was initiated with Sell rating at Goldman Sachs; Tate & Lyle (TATE LN) was downgraded at BNP Paribas; Lufthansa (LHA GY) downgraded at AlphaValue.

DAY AHEAD:

• EVENTS: Apple WWDC 2026 continues (8-12 June).
• DATA: In North America, weekly ADP employment change data is released (the previous weekly print was 35.75k); the US April trade balance is expected to narrow to USD -56.4bln (prev. USD -60.3bln); existing home sales for May are seen ticking up to 4.06mln (prev. 4.02mln); wholesale inventories are expected to rise 0.5% M/M (prev. 1.5%); NFIB business optimism data for May is also due (prev. 95.9); after today’s releases, the Atlanta Fed will update its GDPnow tracking estimate (previously was tracking growth of 3.0% in Q2). In Canada, April trade balance is seen widening to CAD 2.6bln (prev. CAD 1.78bln).
• CENTRAL BANKS: ECB’s Lagarde speaks at informal dinner with EU Commissioner for Climate (no text expected; ECB is on its pre-policy meeting blackout).
• SUPPLY: US auctions USD 58bln of 3yr notes; Germany auctions EUR 2.0bln across 2053, 2035 and 2033 maturities; the Netherlands auctions EUR 2.0–2.5bln of 2035 DSLs.
• ENERGY: The EIA’s monthly STEO report is due; after the close, the API will release its weekly gauge of energy inventories.
• EARNINGS: Notable corporates reporting today include: Casey’s General Stores (CASY), J.M. Smucker (SJM).