Macroeconomic Highlights
Iran's Revolutionary Guards Claim Attack on U.S. Fifth Fleet Headquarters
On June 3 local time, Iran’s Islamic Revolutionary Guard Corps (IRGC) stated that the headquarters of the U.S. Fifth Fleet had been struck by missiles and drones launched by the IRGC Aerospace Force. On the evening of June 2 Eastern Time, U.S. Central Command posted on social media that Iran had carried out attacks across the Middle East on June 2, and that U.S. forces had intercepted several Iranian ballistic missiles and drones. In response, U.S. forces conducted a 'defensive' airstrike on Iran’s Qeshm Island. Earlier, Iranian media reported that communication between Iran and the United States had been 'suspended for several days.' In response, Trump stated on Tuesday that dialogue between the U.S. and Iran had been ongoing.
Trump Signs Executive Order on Artificial Intelligence
The White House announced that President Trump has signed an executive order to promote innovation and safety in advanced artificial intelligence. The U.S. will establish a 'classified benchmarking program' for the AI field. The government will gain access to 'frontier models' of artificial intelligence prior to their public release. Within 60 days, the U.S. will select trusted AI partners. The executive order emphasizes strengthening cybersecurity defenses across all government agencies. Trump has directed federal agencies to develop cybersecurity standards for advanced AI models. Cybersecurity testing of AI companies by the U.S. government will be voluntary. The order mandates the creation of a cybersecurity information-sharing platform to facilitate voluntary collaboration among the AI industry and critical infrastructure operators on software vulnerabilities.
Warsh: Will uphold the Federal Reserve's finest traditions while engaging in 'pragmatic and clear-eyed' discussions on reform
As he began his four-year term, Federal Reserve Chair Kevin Warsh issued an opening-day memorandum to the central bank’s more than 20,000 employees. In the letter, he pledged to uphold 'the finest traditions of the Federal Reserve,' while also committing to a broad review of how its work could be carried out differently. In Warsh’s view, the Fed had previously deviated from its core mission; at the same time, he sought to mend relationships with colleagues and staff whose work he had previously criticized.
Fed's Harker: If inflation remains persistently high, the Federal Reserve could act soon
Fed official Hammack stated that maintaining the current interest rate unchanged remains appropriate for now, but if inflation remains persistently high, policymakers may need to act swiftly, including considering further rate hikes. The PCE price index rose 3.8% year-over-year in April, significantly above the 2% target, and inflationary pressures are broad-based, suggesting the current policy rate may not be sufficiently restrictive. Their policy focus has clearly shifted toward combating inflation, while the labor market remains resilient.
U.S. JOLTS job openings in April rose more than expected to a two-year high, underscoring labor market resilience and reinforcing expectations for higher interest rates.
Data released Tuesday by the U.S. Bureau of Labor Statistics showed that job openings surged to 7.62 million in April, the highest level in nearly two years and significantly exceeding economists’ expectations of 6.87 million. Meanwhile, layoffs declined, a combination indicating that the labor market remains broadly stable even as businesses contend with rising energy costs stemming from the conflict involving Iran.
ECB Report: Gold Historically Overtakes U.S. Treasuries as World’s Largest Reserve Asset
According to the European Central Bank’s latest report released Tuesday, gold accounted for 27% of global central bank reserve assets by the end of 2025, up sharply from 20% a year earlier. Meanwhile, the share of U.S. Treasury securities fell from 25% to 22%, falling below gold for the first time. Gold prices have nearly doubled over the past two years, briefly surpassing a record high of $5,500 per troy ounce in January. This shift carries profound implications for markets. The traditional role of U.S. Treasuries as the 'anchor' of global dollar reserves is being undermined, while structural support for gold—driven by sustained central bank purchases—is unlikely to reverse in the near term.
U.S. Stock Market Update
Major Indices Edge Higher; S&P 500 Breaches 7,600 for First Time as AI Frenzy Overshadows Middle East Concerns
On Tuesday, the three major U.S. equity indices posted modest gains, extending their record highs. At the close, the Dow Jones Industrial Average rose 0.45% to 51,307.79; the Nasdaq Composite gained 0.03% to 27,093.90; and the S&P 500 increased 0.13% to 7,609.90.
$Star Tech Stocks (LIST2518.US)$ Most stocks declined, with Microsoft down 4.17%, Alphabet-A down 3.86%, Amazon down 1.81%, Meta down 0.47%, NVIDIA down 0.69%, Apple up 2.9%, and Tesla up 1.89%.
$Popular Chinese Concept Stocks (LIST2517.US)$ Gains were seen across the board, with Tencent ADR up 9.1%, Meituan ADR up 6.5%, Li Auto up 6.1%, Alibaba up 4.3%, Baidu up 3.3%, NetEase up 1.2%, and PDD Holdings up 1%.
$Optical Communications (LIST23979.US)$ Strength was observed, with Marvell Technology surging 32%, Coherent rising over 17%, Lumentum and Corning climbing more than 13%, and AAOI gaining over 8%.
Escalating tensions involving Iran dampened risk appetite; Strategy’s Monday sell-off broke its long-standing “buy-and-hold-only” policy, acting as a catalyst. Bitcoin dropped as much as 6% on Tuesday, falling below $67,000—the first time since April 5—triggering over $1 billion in forced liquidations across the cryptocurrency market. U.S. equities $Cryptocurrency concept stocks (LIST20010.US)$ declined, with Coinbase down 4.7% and Strategy plunging 9.2%.
Stock-specific news
Based on CPO technology! NVIDIA Spectrum-X silicon photonics switch enters full-scale production
NVIDIA’s Spectrum-X Ethernet silicon photonics technology has now entered full-scale production. The next-generation Spectrum-X switches are built using co-packaged optics (CPO) technology, enabling the NVIDIA Vera Rubin platform to support horizontal and cross-regional scaling of AI factories within data centers. Mass production was achieved through deep collaborative engineering with semiconductor and systems ecosystem partners in Taiwan, with Taiwan Semiconductor, SPIL, TFC, and Foxconn each making critical contributions across the process chain—from silicon photonics to full system integration.
Jensen Huang’s strong endorsement sends Marvell shares soaring
$Marvell Technology (MRVL.US)$ surged over 32%, with an additional 9% gain in after-hours trading. On the second day of Computex Taipei 2026, NVIDIA CEO Jensen Huang publicly endorsed partner Marvell Technology, calling it a potential “next trillion-dollar company,” bringing their strategic collaboration into sharp focus.
Huang emphasized that as AI-generated tokens enter a profitable phase, distributed “agent” computing is driving massive demand for high-speed interconnects. On interconnect technology pathways, Huang stated, “Use copper wherever possible; use optics only when absolutely necessary.” Meanwhile, Marvell’s CEO noted that due to physical limitations, the “copper boundary” is retreating inward toward the rack level, heralding an inflection point for optical interconnects and CPO technologies.
Microsoft Build: Web IQ aims to be Bing for agent-based search; quantum chip upgrades target practical deployment by 2029
At its annual Build developer conference held on Tuesday, May 2, Eastern Time, Microsoft (MSFT.US)the company unveiled a series of major products and technologies: it launched Web IQ, a search infrastructure designed for the AI agent era; introduced its next-generation quantum chip, Majorana 2, significantly accelerating its target timeline for delivering commercially viable quantum computers to 2029; and announced a new AI assistant named Scout, along with a toolchain enabling developers to deploy 'Lobster (OpenClaw)'-style autonomous agent systems on Windows PCs.
Wall Street fund manager: The most important company in the AI era is not NVIDIA, but Taiwan Semiconductor
According to MarketWatch on Tuesday, Jonathan Cofsky, co-portfolio manager of the $9.35 billion Janus Henderson Global Technology and Innovation Fund, stated that Taiwan Semiconductor (TSM.US)Taiwan Semiconductor is the fund's largest holding, surpassing NVIDIA to take the top position. "This is likely the most critical company driving AI development right now," he said. In his view, regardless of which chipmaker ultimately prevails, all leading-edge chips are manufactured by Taiwan Semiconductor—a position of irreplaceable importance that makes it the ultimate beneficiary of the expansion in AI computing capacity.
OpenAI plans to develop AI tools for the financial and legal sectors, competing with Anthropic.
On Tuesday, OpenAI released new plugin tools for Codex, covering business scenarios such as public equity investments, banking, and sales, and announced plans to roll out legal and corporate financing-related features soon. This release aims to compete with Anthropic for enterprise paying customers. OpenAI executives stated the company’s goal is to achieve 50% of its revenue from enterprise clients by the end of this year.
SpaceX pressures Wall Street on pricing: IPO underwriting fee could fall below 0.75%, yet investment banks still stand to earn $500 million
SpaceX said it plans to raise at least $75 billion through a fresh initial public offering (IPO), targeting a $1.75 trillion valuation in its U.S. IPO, including the overallotment option. According to Bloomberg, citing sources familiar with the matter, SpaceX intends to raise $75 billion via the IPO this month and is currently negotiating with underwriters to push the fee rate below 0.75%. Traditional IPO underwriting fees typically range from 4% to 7%, and even for mega-listings, fees generally exceed 1%. Despite the low rate, the 23 banks involved in the offering could still collectively earn approximately $500 million in fees, making it one of the largest IPO fee arrangements in history. Market participants worry that if this low fee becomes a new benchmark, it could compress underwriting profits for subsequent high-profile IPOs from companies like Anthropic and OpenAI.
$Broadcom (AVGO.US)$The stock rose more than 2% in after-hours trading after the company pledged to provide the largest share of funding guarantees for Anthropic’s record-breaking microchip financing deal, lowering the debt cost of the $36 billion transaction.
GameStop (GME.US) Following the release of its earnings report and a $2 billion share repurchase plan, the company’s stock surged as much as 12% in after-hours trading.
Cybersecurity giant$Palo Alto Networks (PANW.US)$ Shares fell more than 3% after hours, with fiscal year 2026 Q3 revenue reaching USD 3 billion, up 31% year-over-year; adjusted EPS was USD 0.85.
Top 20 by trading value
Hong Kong Market Outlook
Southbound capital increased its holdings of Hong Kong-listed stocks by over HKD 2.2 billion, net buying SMIC by more than HKD 900 million and net selling Tencent by over HKD 2.1 billion, while reducing its position in Xiaomi Group by more than HKD 900 million.
On Tuesday, June 2, southbound capital recorded net purchases of HKD 2.223 billion in Hong Kong-listed stocks.
$SMIC (00981.HK)$、$CNOOC Limited (00883.HK)$、$Akeso (09926.HK)$Net purchases amounted to HKD 951 million, HKD 383 million, and HKD 344 million, respectively;
Tencent (00700.HK)、$Xiaomi Group-W(01810.HK)$、$Meituan-W(03690.HK)$Net sales amounted to HKD 2.109 billion, HKD 917 million, and HKD 716 million, respectively.
SK Hynix: Plans to double memory production capacity over five years; shortages to persist until 2030
SK Hynix ( Southern Two-Times Leveraged Hynix (07709.HK) ) announced plans to double its wafer production capacity over the next five years. Chairman Choi Tae-won confirmed that the global memory chip supply shortage could persist until 2030. The company’s market capitalization surpassed USD 1 trillion for the first time, and it holds a dominant 58% share in the HBM market. Goldman Sachs significantly raised its forecast for the company’s operating profit in 2028 by 24%.
Samsung Electronics Unveils HBM5 for the First Time, Betting on Next-Generation AI Memory Competition
Samsung Electronics unveiled its eighth-generation HBM5 prototype for the first time at Computex 2026, introducing HPB thermal management innovation technology, and announced it had already delivered 12-layer HBM4E samples in May. Benefiting from broad-based increases in standard DRAM prices that have strengthened its pricing power, the South Korean memory giant is experiencing a comprehensive profit surge, with Morgan Stanley forecasting Samsung’s operating profit will rise by 464% year-over-year this year.
Today's Focus
Keywords: U.S. ADP Employment Change, Broadcom/CrowdStrike earnings
On the economic data front, the following releases are scheduled: China’s May RatingDog Services PMI, Eurozone’s final May Services PMI, Eurozone’s April PPI, U.S. May ADP Employment Change, U.S. final May S&P Global Services PMI, and U.S. final May S&P Global Services PMI.
09:45 — China’s May RatingDog Services PMI
20:15 — U.S. May ADP Employment Change
21:45 — U.S. final May S&P Global Services PMI
22:00 — U.S. May ISM Non-Manufacturing PMI
On major events, Bank of Japan Governor Kazuo Ueda delivered a public speech.
On the earnings front, Hong Kong-listed stocks Zhihu-W (02390.HK) will release earnings reports, $Medtronic (MDT.US)$ released its earnings report before the U.S. stock market opened, $Broadcom (AVGO.US)$ 、 $CrowdStrike(CRWD.US)$ released its earnings report after the U.S. stock market closed.
Regarding IPOs, $Shougang Bioferm (02553.HK)$ Officially listed on the Hong Kong Stock Exchange.
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Editor/KOKO