Group 1 - The U.S. job market remains stable, but there are emerging cracks that could pose significant challenges in the coming months [1] - In May, the U.S. added 139,000 jobs, slightly above market expectations but below April's 147,000 [1] - The unemployment rate held steady at 4.2%, with the underemployment rate remaining at 7.8% [1] Group 2 - Job growth is primarily driven by the healthcare, leisure and hospitality, and social assistance sectors, but these industries face potential growth limitations due to proposed policy changes [2] - The proposed spending bill includes a $700 billion cut to federal Medicaid spending and increased costs for ACA enrollment, which could severely impact the healthcare sector that has contributed about 30% of new jobs over the past three years [2] - The leisure and hospitality sector may also be affected by new tariff policies, potentially leading to reduced consumer spending and job impacts [2] Group 3 - Job seekers' confidence is declining, with about 40% of job seekers lacking confidence in the current job market, and nearly one-third expecting fewer job opportunities in the next six months [2] - There is a growing disparity in the job market, where those already employed are faring better than new job seekers, particularly recent graduates [3] - Knowledge-based job growth in sectors like finance, marketing, and software development is weak, while professional and business services are cutting positions [3] Group 4 - The Federal Reserve's latest Beige Book indicates a contraction in overall economic activity, with businesses and households becoming increasingly cautious in their decision-making [3] - Recruitment levels are stable, but low employee turnover suggests that companies remain cautious about adding new positions [3]

Market Performance - Developed markets outperformed last week, with MSCI Global Index up by 1.4%, MSCI Developed Markets up by 1.7%, and MSCI Emerging Markets down by 0.9% [3] - In developed markets, the strongest performer was Nikkei 225 (+2.2%), while the weakest was France's CAC40 (+0.2%) [3] - Emerging markets saw the best performance from the Korean Composite Index (+4.1%) and the worst from Taiwan Weighted Index (-1.4%) [3] Sector Performance - In the US stock market, real estate and information technology sectors led with gains of 2.7% and 2.4% respectively, while energy and materials lagged [9] - In the Hong Kong market, healthcare and real estate sectors performed well, with increases of 3.4% and 1.4% respectively [9] - European stocks saw energy and information technology sectors leading with gains of 1.4% each, while materials and communication services lagged [9] Valuation Trends - As of May 30, 2025, developed markets' PE and PB ratios were 22.3x and 3.6x, respectively, indicating high valuation levels [23] - The Nasdaq and Dow Jones Industrial Average had the highest PE ratios at 39.7x and 28.8x, respectively [23] - Emerging markets' PE and PB ratios were 14.9x and 1.9x, with the highest valuations seen in the ChiNext Index and India's Sensex30 [24] Earnings Expectations - In the Hong Kong market, the earnings forecast for the Hang Seng Index for 2025 was slightly revised down from 2223 to 2219 [31] - The US market maintained its earnings expectations for the S&P 500 Index at 263, with the information technology sector seeing a slight increase [31] - European earnings expectations remained stable, with the Eurozone STOXX50 Index holding at 347 [31] Liquidity Conditions - Global liquidity conditions turned more accommodative last week, with declines in benchmark interest rates in the US and China [34] - The market is anticipating potential interest rate cuts from the Federal Reserve, with expectations of 2.2 cuts this year [34] - Long-term interest rates in major economies like France, Germany, and the US saw significant declines, exceeding 10 basis points [34] Economic Outlook - US economic expectations have improved, with the Citigroup Economic Surprise Index rising from 6.0 to 11.5 [43] - European economic expectations also increased, with the Eurozone Economic Surprise Index rising from 12.5 to 17.7 [43] - China's Economic Surprise Index decreased slightly but remains at a historically high level, reflecting strong policy expectations [43]

Group 1 - The announcement of tariffs by President Trump on April 2 has led to a significant decline in merger and acquisition (M&A) activities, with April's global M&A contracts dropping to the lowest level in over 20 years, totaling 2,330 deals, which is 34% lower than the historical monthly average [1] - The total value of global M&A activities fell to $233 billion in April, a 54% decrease from March and 20% lower than the average for the past 20 years [4] - In the U.S., only 555 deals were completed in April, marking the lowest level since May 2009 [1][4] Group 2 - Uncertainty surrounding U.S. trade policies has led investment bankers to advise clients to hold off on M&A and IPOs until there is more clarity [4] - Despite the overall decline, significant transactions like Global Payments' $24.25 billion acquisition of a credit card processing company provided some support to the struggling market [4] - The technology sector accounted for nearly 40% of the $600 billion in deals signed in the U.S. this year, with a focus on intellectual property rather than physical goods affected by tariffs [7] Group 3 - Different industries are experiencing varying impacts from the tariffs, with sectors like telecommunications, media, and utilities being less affected, while industrials and healthcare face greater challenges [7] - Investment banks are advising clients to thoroughly understand the additional risks associated with target companies' business models due to the current volatility in the market [7]

Group 1 - The Hong Kong stock market continues to show strong upward momentum, with the Hang Seng Index, Hang Seng Tech Index, and the China Enterprises Index rising by 3.79%, 6.03%, and 4.02% respectively during the week from February 17 to February 21, 2025 [5][8] - The technology, healthcare, and telecommunications sectors led the gains, with increases of 10.34%, 8.81%, and 6.01% respectively, while materials, energy, and real estate sectors experienced declines of 3.07%, 2.45%, and 0.53% [8][11] - The average daily trading volume on the Hong Kong Stock Exchange increased to HKD 335.88 billion, up HKD 37.15 billion from the previous week, indicating heightened trading activity [11][12] Group 2 - Recent performance of the Hang Seng Index shows a PE ratio of 10.33, which is a 1.75% increase from the previous week and is at the 59th percentile level since 2010 [16][24] - The risk premium of the Hang Seng Index relative to the 10-year US Treasury yield is 5.26%, which is at the 12th percentile level since 2010, indicating a relatively low attractiveness for overseas investors [16][24] - The AH premium index decreased by 1.54 points to 133.72, which is at the 52nd percentile level since 2014, suggesting a moderate valuation gap between A-shares and H-shares [27][29] Group 3 - The investment outlook for the Hong Kong stock market suggests that the technology sector remains a high-investment opportunity due to policy support and rapid AI application development [45] - Consumer stocks are expected to see significant performance improvements due to domestic policies aimed at boosting consumption [45] - High dividend strategies in the Hong Kong market are still attractive, particularly for state-owned enterprises actively managing their market capitalization [45]