EUROPEAN OPEN: US House bill could ban new MBG GY vehicles; EZJ LN says no Castlelake proposal yet; BAYN GY says P2 Aracog trial met primary endpoint; EQNR NO committee recommends Roth as new Chair; SFTBY pledges up to EUR 75bln for France AI clusters

EUROPEAN OPEN:

• European equities are starting the new month with some caution, bucking an overnight lead where global equities advanced, with the MSCI ACWI firmer as AI enthusiasm supported risk sentiment; it was announced that Nvidia had entered the Windows laptop market, SoftBank surged after it pledged to invest up to EUR 75bln in AI computing clusters in France; emerging Asian equities hit records, with MSCI EM higher on AI-linked strength in South Korea and Taiwan.
• Brent crude climbed above USD 93/bbl as US-Iran ceasefire negotiations showed little progress; the two sides exchanged messages over the weekend seeking amendments to a draft agreement to extend a ceasefire and reopen the Strait of Hormuz, though Tasnim news agency reported both sides might ultimately reject the changes. CENTCOM confirmed strikes against Iranian radar and command and control sites in Goruk and Qeshm Island; Iran’s IRGC said its aerospace forces subsequently targeted the airbase from which it said the attack on a communications tower on Sirik Island originated. Elsewhere, The EU is considering freezing its USD 44.10/bbl Russian oil price cap to prevent an automatic rise in July. Analysts at Goldman Sachs said they see two-sided risks to oil prices; April demand data from China and Western Europe imply roughly 2mln BPD of downside risk, adding USD 10/bbl of downside to a Q4 Brent forecast of USD 90, while supply disruptions from the Iran war present significant upside risks. Gold has edged lower, near USD 4,520/oz.
• USDJPY traded around 159.50, with traders flagging heightened intervention risk after the yen weakened despite Japan’s record USD 73.6bln support; wide US-Japan rate differentials and higher oil prices weighed ahead of the BoJ’s 16th June meeting, with markets pricing around 78% odds of a hike. Other EM FX slipped as oil prices and the USD rose.
• In central bank speak, ECB’s Schnabel said the bank can no longer look through inflation from the Iran war; ECB’s Pereira urged earlier action to avoid second-round effects; ECB’s Villeroy said Bank of France 2026 French growth estimates will be revised down after a bad Q1 surprise, but should remain positive in most scenarios. BoE’s Mann said the “good luck” of the Great Moderation has run out as economies enter a more shock-prone inflation era; Mann added that markets are a greater discipliner of economies and central banks.
• French Finance Minister Lescure said S&P confirmed France’s A+ rating with a stable outlook. In UK politics, Andy Burnham left open calling an early general election if he replaces PM Starmer; Starmer is this week facing the compelled release of private exchanges linked to Peter Mandelson’s vetting, which could bring more negative headlines for his government. Elsewhere, Wes Streeting backed new North Sea drilling, targeted employer NI cuts for young hires, and equalising capital gains and income tax rates.
• In data releases, Nationwide house prices fell by -0.6% M/M in May (prev. 0.4%), with the annual rate falling to +1.7% Y/Y (prev. +3%). German retail sales declined by -0.3% M/M in April (prev. -2%), though the annual rate rose to a still negative -0.3% Y/Y (prev. -2% Y/Y).

STOCK SPECIFICS:

• INDUSTRIALS: EasyJet (EZJ LN) said it has not received a proposal from Castlelake, noting that any offer would be required to be made at no less than 403.23/shr; the statement follows reports that Castlelake was in the early stages of considering a takeover bid for the airline.
• ENERGY: BP (BP/ LN) board is facing shareholder pressure following the ousting of Chair Manifold, Telegraph reports; one shareholder reportedly said the entire board needs to undertake a collective “soul search” and learn lessons from the episode. Equinor (EQNR NO) nomination committee has recommended Jarle Roth as the new chair of the board of directors, following the planned resignation of Jon Erik Reinhardsen, who has served as chair since 2017.
• TECH: Nvidia (NVDA) is entering Windows PCs (MSFT) with RTX Spark chips for Dell (DELL) and Lenovo (LNVGY) devices, challenging Intel (INTC), AMD (AMD) and Qualcomm (QCOM) using MediaTek, Microsoft Arm software and TSMC (TSM) manufacturing. Elsewhere, US Commerce Department tightened licence rules for China-headquartered overseas subsidiaries using advanced AI chips, including Nvidia Blackwell processors, without halting data-centre use or servicing. SoftBank (SFTBY) pledged to invest up to EUR 75bln in AI computing clusters in France; the initial commitment is EUR 45bln for 3.1GW of capacity in Hauts-de-France by 2031, with another 2GW planned. The Dunkirk site will involve Schneider Electric (SU FP); customers and computing-equipment providers remain undetermined, the report said.
• COMMUNICATIONS: Meta (META), Alphabet’s (GOOG) YouTube, Snap (SNAP) and TikTok agreed to settle a Breathitt County schools addiction lawsuit for about USD 27mln, amid more than 1,300 similar cases. Elsewhere, Meta plans an AI pendant using Limitless technology acquired late 2025, smart glasses and enterprise services. Universal Music Group (UMG NA) board unanimously rejected an unsolicited takeover proposal from Bill Ackman’s Pershing Square, saying the offer materially undervalues the company, and is not in the best interests of shareholders, artists, or the company.
• CONSUMER: A US House bill targeting Chinese-linked automakers could result in a ban on new Mercedes-Benz (MBG GY) vehicles in the US, according to CNBC; The legislation’s exemptions would not apply to Mercedes-Benz despite its significant US manufacturing presence, as Chinese state-owned automaker BAIC is the company’s largest individual shareholder. Luxury stocks received a constructive mention in Bloomberg, which notes renewed Chinese luxury demand, with Louis Vuitton (MC FP) and Burberry (BRBY LN) Q1 store sales growing, Alibaba’s (BABA) beauty sales up 39%, and ChiNext up approximately 26%.
• HEALTHCARE: Bayer (BAYN GY) said Phase II Aracog trial met its primary endpoint, with Nubeqa showing significantly less decline in objective cognitive performance over 24 weeks than enzalutamide in advanced prostate cancer. BioNTech (22UA GY) and Bristol Myers Squibb (BMY) announced interim Phase 2 ROSETTA Lung-02 data on pumitamig plus chemotherapy for previously untreated advanced non-small cell lung cancer patients. Novartis (NOVN SW) said Pluvicto plus standard of care improved rPFS across prostate cancer subgroups, matching a 28% risk reduction, and presented EULAR 2026 immunology data.

DAY AHEAD:

• EVENTS: President Trump participates in a Policy Meeting at 11:00EDT/16:00BST; the President will also be signing executive orders today. COMPUTEX 2026 is set to take place between 2-5th June, with presentations already beginning ahead of the events.
• DATA: In Europe, final PMI data for May are due; France exp. at 48.9 (prev. 52.8), Germany at 49.9 (prev. 51.4), Eurozone expected at 51.4 (prev. 52.2); UK Manufacturing PMI final is seen at 53.7 (prev. 53.7). Eurozone April unemployment data are also released today (prev. 6.2%). ECB Consumer Expectations Survey for April will be released. In North America, US ISM Manufacturing PMI headline is expected at 53.0 (prev. 52.7), with new orders little changed at 54.3 (prev. 54.1), though prices are expected to rise to 86.0 (prev. 84.6), while employment is seen little changed at 46.6 (prev. 46.4). The final US S&P Global Manufacturing PMI are due before then (exp. 55.3, prev. 54.5); US also releases construction spending figures for April (exp. 0.4% M/M, prev. 0.6%). Atlanta Fed will update its Q2 GDPNow tracking estimate (prev. 3.8%).
• SPEAKERS: ECB’s Schnabel (hawk) is due to make further remarks today (text expected).
• EARNINGS: Notable corporates reporting today include: Hewlett Packard Enterprise (HPE).
• WEEK AHEAD: This week’s notable highlights include US ISMs, NFP, EZ HICP & Canadian Jobs. Earnings quieten down with highlights including: Broadcom (AVGO), Palo Alto Networks (PANW), CrowdStrike (CRWD), Medtronic (MDT), Ciena (CIEN), Veeva (VEEV), Dollar General (DG), Ulta Beauty (ULTA), Lululemon (LULU), Brown-Forman (BF), Macy’s (M), PVH (PVH), Cooper Companies (COO), DocuSign (DOCU), Hewlett Packard Enterprise (HPE), Signet (SIG).
• Click here for Newsquawk’s week ahead preview.
• Click here for Newsquawk’s Weekly US Earnings Estimates.
• PRIMER - US ISM MANUFACTURING PMI (15:00BST/10:00EDT): ISM Manufacturing PMI headline is expected at 53.0 (prev. 52.7), with new orders little changed at 54.3 (prev. 54.1), though prices are expected to rise to 86.0 (prev. 84.6), while employment is seen little changed at 46.6 (prev. 46.4). As a proxy, S&P Globalʼs flash manufacturing PMI rose to 55.3 in May (from 54.5), a 48-month high, with the output index also firming to 56.2, its strongest reading in 49 months. Under the bonnet, however, the picture was somewhat nuanced. The marked influx of new orders was again driven predominantly by precautionary stock-building by clients rather than end-demand, and order book growth was purely domestically driven, with goods exports falling again, S&P said. Supply chains deteriorated sharply, with supplier delivery times lengthening to the greatest degree since August 2022 as war-related shipping disruptions compounded existing tariff-related constraints; input purchases rose at the steepest rate since April 2022, driving inventories higher. Input cost inflation registered its largest monthly increase since June 2022, with selling prices rising at the fastest pace since September 2022. On the labour front, manufacturing payrolls posted their largest increase in 11 months as factories hired to meet the order upturn. Looking ahead, manufacturer sentiment improved to its most optimistic since February 2025, buoyed by the recent order strength and anticipation of tariff-related re-shoring, though the reliance on precautionary stocking as a demand driver remains a key caveat.