Asia open: US futures dipped as US-Iran peace deal hopes dimmed

• US futures edged lower in the early Asian session: Donald Trump rejected Iran’s latest peace response, dampening hopes for a formal US-Iran agreement and keeping geopolitical risk premiums elevated.
• Stronger-than-expected US April jobs data: Reinforced the “higher for longer” interest rate narrative, reducing expectations for Federal Reserve rate cuts in 2026 and supporting elevated Treasury yields.
• The AI-driven equity rally remains intact globally: Supported by semiconductor momentum, expanding hyperscaler AI capex, and new industrial AI initiatives involving Apple, Intel, and Jeff Bezos.
• Chart of the day: Nasdaq 100’s bullish impulsive up move overstretched, at risk of minor corrective decline below 29,505/615 key short-term resistance. Intermediate supports at 28,835 and 28,460/280.

• Trump rejects Iran peace response: U.S. President Donald Trump called Iran's response to the US peace proposal 'unacceptable' over the weekend. This diplomatic snag casts a shadow over the immediate prospects of a formalized treaty, keeping a floor under geopolitical risk premiums even as active military engagements pause.
• US jobs report defies expectations: A better-than-expected April employment report (actual: 115K vs consensus: 62K) has led analysts to conclude that the Federal Reserve may forgo any interest rate cuts in 2026, as robust hiring and sticky inflation keep policy restrictive.
• US-Iran ceasefire holds after test: Reuters confirmed that while the U.S. and Iran exchanged fire late last week in the most serious test of their ceasefire, both sides indicated they did not want to escalate, and the situation has returned to normal.
• Apple & Intel's chip pact: The AI hardware supercycle continues to dominate, with reports emerging over the weekend that Apple has reached a preliminary deal with Intel to produce chips.
• Yuan hits 3-year highs ahead of summit: China's yuan strengthened to a three-year high against the US dollar, setting the stage for the highly anticipated Beijing summit between US President Trump and Chinese President Xi Jinping on May 14-15.
• Bezos targets industrial AI: Reuters Breakingviews highlighted that Amazon founder Jeff Bezos is raising $10 billion to help build AI models that understand the physics of production, signaling the next wave of AI capital expenditure.

• The "No Rate Cuts" reality: The combination of the hot April jobs report and persistent inflation has cemented the "higher for longer" narrative. Markets are actively pricing out the likelihood of any Federal Reserve easing for the remainder of 2026.
• Complex geopolitics (ceasefire holds, diplomacy stalls): Equity investors are navigating a nuanced Middle East landscape. While the physical ceasefire holding prevents a devastating oil spike above $100/bbl, Trump's "unacceptable" designation of Iran's terms means energy and defense sectors will retain a persistent risk bid.
• AI Capex expanding beyond Silicon Valley: The AI boom is broadening. With Morgan Stanley projecting top-tier hyperscaler AI capex to top $1.1 trillion next year, investments are now flowing into industrial and physical-world AI applications.

Equities: Wall Street advanced robustly on Friday, with the S&P 500 recording weekly gains. Semiconductor giants like AMD and Micron led the charge higher as the AI trade remains the dominant market force. Today’s early Asian session (Monday), S&P 500 and Nasdaq 100 E-mini futures dipped 0.2% after Trump rejected Iran’s peace deal proposal.

Fixed Income: The strong jobs report keeps intense pressure on the bond market. The US long bond yield (30-year) remains supported at 4.90% (50-day moving average), implying risk of deeply anchored inflation expectations.

FX: The Japanese Yen remains highly volatile following Japan's suspected $67 billion intervention over the past two weeks. The Yuan is serving as a regional anchor at three-year highs.

Commodities: Gold rally remained subdued below its 50-day moving average, acting as a key intermediate resistance at around $4,775/oz, while China's PBOC loaded up on bullion for an 18th straight month offers support. Crude oil is fluctuating near the $100 level.

• Stock markets: Asian tech giants continue to provide the bull run's center of gravity. South Korea's KOSPI recently crossed the historic 7,000 mark as Samsung's market cap surpassed $1 trillion, driven by surging memory chip demand. Mixed performances; KOSPI (+4%), and Nikkei 225 (+0.5%), while intraday losses were seen in Hang Seng Index (-0.9%) and ASX 200 (-0.8%) at this time writing.
• Currencies: The PBOC's management of the Yuan is keeping regional FX relatively stable ahead of the Trump-Xi summit, though the Yen's wild swings (recently touching 155/$) are keeping carry-trade investors on edge.
• Economic outlook: The region is absorbing the dual impacts of an AI-driven export boom (massively benefiting Taiwan and South Korea) while navigating the structural headwinds of expensive energy imports.

1. China Inflation Rate & PPI (Apr) - 9:30 am SGT (consensus: 0.8% y/y-Inflation & 1.5% y/y-PPI) Impact: USD/CNH, Hang Seng, China A50, AUD/USD
2. US Existing Home Sales (Apr) - 10:00 pm SGT (consensus: 4.05M, Mar:3.98M) Impact: US stock indices, USD
3. Geopolitical updates on the US-Iran peace proposal Impact: All asset classes

The price actions of the US Nasdaq 100 CFD index (a proxy of the Nasdaq 100 E-mini futures) had undergone a steep bullish impulsive up move sequence since 30 April 2026, and two key technical elements suggest that it now faces an imminent risk of a minor corrective pull-back.

Last Friday’s rally on 8 May has led the US Nasdaq 100 CFD index to hover right below the upper boundary of its medium-term ascending channel in place since the 30 March 2026 low. Secondly, the hourly RSI momentum indicator has started to stage a downward reversal after it surged close to an extreme overbought level of 85 (see Fig. 1).

Watch the 29,505/615 key short-term pivotal resistance. A break below 28,835 (downside trigger) may expose the next intermediate support at 28,460/280 (also the lower boundary of the ascending channel from 30 March 2026 low).

On the flip side, a clearance and an hourly close above 29,615 invalidates the minor bearish scenario to see the continuation of the bullish impulsive up move sequence for the next intermediate resistances to come in at 29,893/953 and 30,410/417.