The XTB Morning Ticker (May 16, 2025)

• Asian markets ended the week with mixed signals from Wall Street, where indices edged down slightly after a mixed day of trading. Hong Kong's Hang Seng Index lost over 1 percent, weighed down by Alibaba's slump of more than 5 percent, following disappointing fourth-quarter results. Markets in mainland China also declined, with the Shanghai Shenzhen CSI 300 and the Shanghai Composite falling about 0.4 percent and 0.3 percent, respectively. Australian stocks, however, fared better, gaining 0.7 percent on the expected central bank interest rate cut.
• US stock futures declined, with the S&P 500 futures contract down 0.1%, as the early-week rally sparked by the easing of the US-China trade tensions lost momentum. Traders fear the recovery may have overshot amid uncertainty over how the tariff situation will unfold after the 90-day deadline. Bond markets found support from Thursday's unexpected decline in US producer prices, which pushed 10-year Treasury yields down 3 basis points to 4.424%.
• The Japanese economy is shrinking more than expected: GDP fell by 0.7 percent year-on-year in the first quarter, far exceeding forecasts of 0.2 percent. The decline, the first in a year, was caused by weaker exports and stagnant consumer spending, highlighting the impact of US tariffs and global trade uncertainty. The Nikkei 225 fell 0.5 percent following the disappointing data, and the TOPIX lost 0.3 percent.
• BOJ board member warns against interest rate hikes amid US tariff concerns. Toyoaki Nakamura, known as the most dovish member of the board, urged the central bank to refrain from raising interest rates. "The Japanese economy is under increasing downward pressure," Nakamura warned, noting that US tariffs on Japanese automobiles could seriously hurt corporate profits. Most economists now expect the BOJ to maintain current interest rates until September.
• During his visit to the Gulf state, Trump announced contracts with the United Arab Emirates worth over $200 billion, including a $14.5 billion commitment from Etihad Airways to purchase 28 Boeing 787 and 777X aircraft powered by GE engines. Etihad confirmed the order, with delivery expected in 2028. The White House announced that the United Arab Emirates will invest in or finance US data centers "at least as large and capable as those in the United Arab Emirates" to strengthen cooperation between the two countries in the field of artificial intelligence.

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