The Overnight News Roundup - May 19

Your Daily Edge: Overnight Headlines for Traders, Analysts, and Market Observers

May 19, 2025

PiQ and Zack Eiseman provide you with a consolidated roundup of the overnight news that matters most to markets.

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Risk off with US bonds and the Dollar pressured after Moody’s Ratings cut the United States’ sovereign credit rating down one notch to Aa1 from Aaa on Friday, citing the growing burden of financing the federal government’s budget deficit and debt. (Newswires)

TRADE:

Trump said that he would be willing to travel to China to meet with Chinese President Xi to discuss foreign policy and economic issues. Trump said his recent visit to Saudi Arabia, Qatar, and the UAE were part of efforts to keep those nations from aligning with Beijing. (Fox News)
Trump said on Saturday, "Between Walmart and China they should, as is said, 'EAT THE TARIFFS,' and not charge valued customers ANYTHING." (Truth Social)
US Treasury Secretary Bessent said in television interviews on Sunday that Trump will impose tariffs at the rate he threatened last month on trading partners that do not negotiate in "good faith" on deals. (RTRS)
US VP Vance met European Commission President von der Leyen and Italian PM Meloni on Sunday, and said he hoped their encounter would help move forward trade talks between the EU and the US. Vance also discussed trade with Canadian PM Carney in Rome. (RTRS)
Japan won’t compromise its national interests in trade talks with the US by fixating on time limits, Prime Minister Shigeru Ishiba said, signaling Tokyo isn’t rushing into an agreement. (BBG)
China has begun allowing some shipments of rare earths under new export control rules, but the slow pace of approvals threatens disruption to global supply chains, according to industry participants cited by the FT. (FT)
China on Sunday announced anti-dumping duties as high as 74.9% on imports of POM copolymers, a type of engineering plastic, from the United States, the European Union, Japan and Taiwan after a probe was launched in May 2024. (RTRS)
Australian PM Albanese said Australia is “up for a deal” with the European Union, sounding a note of cautious optimism after years of trade negotiations. (BBG)

MACRO:

US Treasury Secretary Bessent on Sunday dismissed Moody's downgrade of the US sovereign credit rating, saying the administration would ensure growth outpaced its debt and pointing to recent pledges of Middle East investment. (CNN)
US Treasury yields rise past 5% over fiscal concerns. (FT)
US House Panel approved the Trump tax cut bill on Sunday, setting up a possible vote on passage this week. House Speaker Johnson expects the reconciliation bill will reach the Rules Committee by Tuesday or Wednesday, with a potential House floor vote by Thursday. (Newswires)
Trump on Saturday said, "THE CONSENSUS OF ALMOST EVERYBODY IS THAT, 'THE FED SHOULD CUT RATES SOONER, RATHER THAN LATER... Too Late Powell, a man legendary for being Too Late, will probably blow it again - But who knows???", Trump added. (Truth Social)
China’s recorded holdings of Treasuries have fallen below those of the UK for the first time since the start of the century. (FT)
Goldman Sachs see the year-end level of 10-year U.S. Treasurys higher than before, raising their forecast to 4.5% from 4.0%. The move follows a larger and faster de-escalation in U.S.-China tariffs, they say, which has trimmed the downside tail. (WSJ)
Goldman Sachs said on Sunday it is retaining a cautious outlook on oil prices, as pressure from likely elevated Iranian supply and higher OECD commercial inventories will offset support from stronger global GDP growth. (RTRS)
Growth in China's industrial output slowed less than feared in April (+6.1% vs exp. +5.5%; prev. +7.7%) but retail sales growth slowed deeper than expected (+5.1% vs exp. +5.5%, prev. +5.9%). (RTRS)
China's new home prices were unchanged in April from a month earlier, extending the no-growth trend to nearly two years despite policymakers' efforts to stabilise the sector. (RTRS)
Chinese fossil fuels output fell in April from the record levels hit in the prior month, although natural gas, crude oil and coal all delivered increases compared to the previous year as the government continues to prioritize security of supply despite weaker prices. (BBG)
China's crude steel output in April slid 7% from March, defying analysts' expectations of a rise against the backdrop of healthy profits and robust exports, but production was still reasonably high. (RTRS)
China reminded officials around the country to cut wasteful spending on travel, food and office space, adding to signs of an austerity push by President Xi Jinping as economic headwinds strain government budgets. (BBG)
Demand for platinum jewellery in China, which has declined significantly over the past decade, has started picking up, helping drive a deeper than previously expected global platinum deficit this year, the World Platinum Investment Council said on Monday. (RTRS)
At least five companies from mainland China or Hong Kong are planning IPOs, dual listings, or share placements in Singapore in the next 12 to 18 months, four sources said to Reuters, as Chinese firms look to expand in Southeast Asia amid global trade tensions. (RTRS)
Hong Kong dollar weakened to a near one-year low against the U.S. dollar on Monday, pressured by flush local currency conditions in the financial hub. (RTRS)
Support for Japanese PM Ishiba’s government weakened, according to public opinion surveys published by major Japanese news organizations over the weekend, although it remains unlikely he’ll be ousted before a national election in July. (BBG)
Hedge funds and long-term investors are re-entering trades looking for the yen to rally ahead of potential currency talks this week between the US and Japan. (BBG)
Goldman raised its 12-month Topix target level to 2,900 from 2,775, and its assumption for full-year 2025 earnings per share growth to 2% from -1%, suggesting it will benefit from a more benign macro outlook and improved sentiment for risk-taking after a cooling in US-China tariff tensions. (BBG)
BoJ Deputy Governor Uchida reaffirmed that the central bank will continue to raise rates if economic growth re-accelerates and underlying inflation is on track to hit its 2% target. (RTRS)
Negotiators for the EU and the UK have reached a deal to strengthen their bilateral relationship ahead of a summit meeting on Monday, according to Bloomberg sources. The draft still needs to be approved by political leaders on both sides. (BBG)
ECB's Wunsch said in the FT that the ECB may need to cut rates to "slightly below" 2% as global trade tensions pose downside risks to inflation and growth. Wunsch sees no case for a larger, half-point cut in the foreseeable future. (FT)
Germany has dropped its long-held opposition to nuclear power, in the first concrete sign of rapprochement with France by Berlin’s new government led by conservative Chancellor Friedrich Merz. (FT)
The EU will need to spend at least €10bn more than last year to refill its gas stores ahead of winter, after the first cold season in four years left its reserves heavily depleted. (FT)
Portugal’s ruling center-right coalition won a snap election Sunday in a vote that saw the far-right and the Socialists compete neck-and-neck for second place. (BBG)
Taiwan is seeking LNG shipments following the shutdown of its last nuclear reactor, a move that will increase the island’s reliance on the seaborne fuel. (BBG)

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GEOPOLITICS:

Russia launched on Sunday its largest drone attack on Ukraine since the start of the war a day before Trump is due to discuss a proposed ceasefire with Russia's Putin. (RTRS)
Iran's Supreme Leader Khamenei accused Trump on Saturday of lying when the president said during his Gulf tour this week that he wanted peace in the region. That followed comments from foreign minister Araqchi on Saturday warning that Washington's constant change of stance is prolonging nuclear talks. (RTRS)
Israel’s military began activating troops in Gaza on Sunday as part of a larger ground operation aimed at pushing Hamas to demilitarize and release the remaining hostages it holds. (WSJ)
Taiwan's coast guard said on Monday China could try to disrupt public morale on the island ahead of President Lai Ching-te's one-year anniversary this week. (RTRS)

EQUITIES:

The White House and congressional officials have been scrutinising Apple's plan to strike a deal with Alibaba to make the Chinese company's AI available on iPhones in China, The New York Times reported on Saturday, pressuring shares of Alibaba on Monday. (NYT)
Nvidia CEO Huang on Monday announced plans to build an AI supercomputer for Taiwan with the island's two top tech players, Foxconn and TSMC, and the Taiwanese government, as demand for "sovereign AI" grows around the world. (Nikkei)
Nvidia is evaluating how to address the China market after the U.S. government placed limits on sales of its Hopper H20 chip there but it will not put out another version of the Hopper chip, CEO Jensen Huang said on Saturday. (RTRS)
Qualcomm said it will make custom data center central processing units, or CPUs, that use technology from Nvidia to connect to Nvidia's artificial intelligence chips. (RTRS)
Supermicro announced that it is now taking orders for enterprise AI systems with NVIDIA RTX PRO 6000 Blackwell Server Edition GPUs. (Newswires)
JPMorgan Chase’s investor day on Monday is showcasing potential successors to CEO Dimon. Top contenders include Marianne Lake, who runs Chase Bank and its credit card business, and Doug Petno and Troy Rohrbaugh, co-heads of the corporate and investment bank. (WSJ)
The US nuclear industry is intensifying its lobbying blitz to save the Inflation Reduction Act tax credits it says are vital for meeting AI-fuelled energy demand. (FT)
Chinese smartphone and EV maker Xiaomi said on Monday it plans to invest at least 50 billion yuan ($6.93 billion) in chip design over at least 10 years. (RTRS)
Half of China's sales of heavy trucks could be electric vehicles by 2028, up from 10% in 2024, the chairman of battery maker CATL said on Sunday. (RTRS)
BT is in advanced talks to sell its 50% stake in British broadcaster TNT Sports to U.S. joint venture partner Warner Bros Discovery, the FT reported on Saturday. (FT)
Ryanair reported a decline in fiscal-year earnings that was in line with analysts’ expectations, as costs rose and average fares fell. The co. was optimistic on fare prices recovering, noting robust demand across Europe. (WSJ/RTRS)
Diageo forecast a $150 million annual hit from Trump's tariffs, and launched a $500 million cost-savings programme. (RTRS)
UK to regulate ‘buy now, pay later’ lenders in legal overhaul. (FT)