This content was published on
June 5, 2026 - 02:49
5 minutes
(Bloomberg) — Asian stocks declined along with US equity-index futures as enthusiasm for the artificial intelligence trade cooled after driving markets to record highs this year.MSCI’s regional equity gauge dropped 1.3%, with South Korea — the world’s best-performing gauge this year and a bellwether for AI investments — tumbling 5.7%. Futures contracts for the Nasdaq 100 Index dropped over 1%, indicating a third day of losses for the tech-heavy gauge. On Thursday, investors rotated out of tech stocks and into a broader range of sectors, helping lift the Dow Jones Industrial Average to a record high.Elsewhere, Brent steadied to trade around $95 a barrel on Friday. Crude fell in the previous session as investors bet the US and Iran were moving closer to a diplomatic breakthrough following a conditional ceasefire between Israel and Lebanon. Treasuries were little changed, while Bitcoin edged up to trade around $63,700.The blistering rebound in semiconductor stocks from their war-driven lows paused after Broadcom Inc.’s outlook for AI-chip sales fell short of elevated expectations. Investors now face a crucial test on Friday with the US jobs report, which could reshape expectations for Federal Reserve policy and determine whether the AI-fueled rally broadens further or loses momentum.“The rally off the March lows has been an extremely strong one. In fact, it has been parabolic, especially for the chip stocks,” said Matt Maley at Miller Tabak. “Therefore, if the earnings report from Broadcom is the catalyst for a pullback that lasts more than a day or two, it would actually be healthy for the stock market.”Meanwhile, President Donald Trump said ceasefire talks are in the “final” stages. Earlier, Iran’s foreign minister said the negotiations had stalled. On Wednesday, Iran fired missiles and drones at Kuwait and Bahrain, killing one person and injuring dozens at Kuwait’s main airport, after the US struck an oil tanker headed to the Islamic Republic.In Lebanon, Hezbollah militants said they refused to abide by the conditions of a ceasefire announced by the US State Department only hours before.In Asia, traders will be watching regional foreign-exchange markets after the South Korean won fell to its weakest level since 2009, underscoring the pressure some Asian currencies face as the Iran war drags on.Also, global investors are rapidly losing confidence in Indonesia as the nation’s stocks tumble at the fastest pace worldwide and its currency sinks to all-time lows.Policymakers are nearing the limits of their currency defenses, with authorities in Indonesia and the Philippines stepping up efforts to support their exchange rates.The key for traders on Friday will be the monthly US employment numbers. Treasury bond traders, having bought into the prediction that the Fed will raise interest rates during the next 12 months, stand to pay a heavy price if US employment data for May are weak.The May data is slated to be released at 8:30 a.m. in Washington. It’s expected to show an 85,000 increase in nonfarm payrolls, a three-month low, and an unchanged 4.3% unemployment rate, the median estimates of economists in a Bloomberg poll show.While the US-Iran conflict and AI continue to dominate the market narrative, Friday’s jobs report is very important for markets, said Tom Essaye of the Sevens Report.“A ‘too tight’ labor market would risk increasing the chances of Fed rate hikes sooner than expected,” he said.Corporate Highlights:SpaceX set out its IPO pitch to retail investors early on Thursday with a video in which Chief Financial Officer Bret Johnsen joins the dots between the company’s rocket, satellite and AI businesses. Blackstone Inc. limited redemptions from its flagship private credit fund for the first time after investors sought to pull 10% of the shares, the latest firm to cap withdrawals amid a continued investor exodus. International Business Machines Corp. and AT&T Inc.’s computer systems were repeatedly breached by foreign hackers, and the companies concealed those intrusions from the US government in violation of the law, according to a lawsuit from a former IBM cybersecurity official. S&P Dow Jones Indices will keep its existing eligibility requirements for main benchmarks like the S&P 500 Index, rejecting proposals that would have made it faster for mega-cap companies such as Elon Musk’s SpaceX to gain rapid entry into the benchmark after going public. Some of the main moves in markets:StocksS&P 500 futures fell 0.5% as of 9:38 a.m. Tokyo time Hang Seng futures rose 0.3% Japan’s Topix was little changed Australia’s S&P/ASX 200 fell 0.6% Euro Stoxx 50 futures fell 0.2% CurrenciesThe Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1612 The Japanese yen was little changed at 159.97 per dollar The offshore yuan was little changed at 6.7777 per dollar The Australian dollar was little changed at $0.7127 CryptocurrenciesBitcoin rose 0.2% to $63,675.17 Ether fell 0.3% to $1,767.96 BondsThe yield on 10-year Treasuries was little changed at 4.47% Australia’s 10-year yield declined one basis point to 4.91% CommoditiesWest Texas Intermediate crude fell 0.3% to $92.76 a barrel Spot gold fell 0.3% to $4,462.49 an ounce This story was produced with the assistance of Bloomberg Automation.©2026 Bloomberg L.P.
