Asia open: US futures slip after S&P 500 hits record

Global equity benchmarks hit fresh highs on Monday before Asian markets opened lower. The S&P 500, Nasdaq, MSCI World and Japan's Nikkei 225 reached record closes after President Donald Trump stated Washington and Tehran remain engaged in active diplomatic discussions despite recent military exchanges. The advance was concentrated in technology and AI-related stocks.

In early Asian trade U.S. futures fell and regional markets saw profit-taking. The Nikkei 225 and South Korea's KOSPI each fell about 1.1%, China A50 declined roughly 1%, and Australia's ASX 200 dropped about 1%. Singapore's STI gained about 0.3%.

U.S. manufacturing data showed activity at a four-year high. The ISM Manufacturing PMI for May rose to 54.0 from 52.7 in April. Market participants linked the rebound to heavy, front-loaded corporate capital expenditures tied to artificial intelligence.

Major technology names led Monday's gains. Dell and Oracle rose about 10% each, Nvidia advanced roughly 6%, Micron shares traded above a $1,000 level, and Hewlett-Packard jumped about 28% in after-hours trading after reporting earnings. Qualcomm fell about 9%, Meta declined about 5%, and Intel lost roughly 5%.

Generative AI firm Anthropic filed confidentially for a U.S. initial public offering. OpenAI is preparing a filing, and SpaceX plans to price a large listing later this month. Some institutional desks estimate as much as $4 trillion of new market capitalisation could come to market in the coming weeks.

Nvidia unveiled a specialised chip architecture intended to bring generative AI capabilities to standard laptops and desktop PCs. Hardware developments were among factors cited by market participants during the session.

Market breadth was narrow despite headline highs. Only two of the S&P 500's 11 major sectors finished positive on Monday — technology and energy — while utilities fell about 3% and consumer discretionary dropped about 2.6%.

Macro and commodity themes added pressure. The U.S. personal savings rate is about 2.6%, near its lowest level since 2008 when excluding a June 2022 anomaly. National gasoline stockpiles have declined for 15 weeks, reducing an operational buffer ahead of the summer driving season. Global crude benchmarks rose about 4% to 5% after weekend military exchanges in the region. Spot gold fell about 1.2% as U.S. Treasury yields moved modestly higher.

Currency markets showed a firmer dollar. USD/JPY approached the perceived 160.00 intervention threshold, with short-term resistance around 159.85 and potential support near 159.10 and 158.80. A sustained move above 159.85 would open higher levels around 160.23 and 160.65.

Traders will watch preliminary Eurozone core inflation for May, comments from Federal Reserve officials including Eric Hammack, and any further developments on the U.S.-Iran diplomatic track for market direction.