How The Day Played Out
Results from Broadcom that sent its shares tumbling double digits set the stage for Thursday's weakness, while on one positive note, consumer-oriented stocks rose as oil and yields slipped after Israel and Lebanon agreed to a ceasefire. That divergence defined the character of the entire session - two competing forces pulling the market apart along the technology and non-technology axis, and the resolution was not what many traders anticipated heading into the London open.
The Dow Jones Industrial Average rallied to a fresh record high on Thursday, while the Nasdaq Composite underperformed as investors appeared to rotate out of chip names in favour of non-tech stocks. The 30-stock Dow jumped 827 points, or 1.6%, while the Nasdaq traded just below the flatline and the S&P 500 rose 0.4%. UnitedHealth led the Dow higher, rising more than 5%, while JPMorgan Chase and Walmart added to the benchmark's advance, climbing 4% and 1% respectively. Non-tech names outside of the Dow such as Costco and Eli Lilly gained more than 1% and 5% respectively. The rotation was sparked by a sell-off in Broadcom that led investors to pare exposure to stocks with ties to artificial intelligence.
Broadcom's fiscal Q2 revenue miss and disappointing AI chip forecast - sending shares down more than 14% and wiping roughly $300 billion in market cap - dominated Thursday's session, dragging chip peers Micron, Marvell, and AMD lower while cooling AI optimism globally. This is not a one-day footnote. With Macquarie flagging Google's push to reduce Broadcom reliance, and Micron, Marvell, and AMD all selling off in sympathy, the semiconductor complex faces a credibility test heading into next week.
The two data releases that actually moved markets today both softened the dollar, which had a cascading effect across the instrument set. Initial jobless claims hit their highest level since early February last week. First-time filings totalled 225,000 for the week ending May 30, up 13,000 from the prior period and higher than the consensus estimate for 215,000, marking the highest level for claims since February 7. Separately, productivity rose 0.3% in the first quarter, below the 0.5% forecast, while unit labour costs increased 1.8%, below the 2.4% estimate. The claims miss in particular was enough to take some of the edge off the hawkish narrative that Wednesday's ADP and ISM prints had built. Yields edged lower, the dollar softened, and gold recovered toward $4,500.
A significant development landed during the New York morning session. The IMF on Thursday urged the Federal Reserve in its first policy meeting led by new Fed Chair Kevin Warsh to stay cautious on rates due to persistent upside inflation risks from energy price shocks and increasing pass-through of higher tariff costs. The IMF now forecasts that a return of inflation to the Fed's 2% target will be delayed to the end of 2027, compared with its previous forecast of mid-2027. With the June 16-17 FOMC now less than two weeks away, this adds institutional weight to the higher-for-longer regime. Kevin Warsh took office as chairman of the Board of Governors of the Federal Reserve in May 2026, for a four-year term ending in 2030. His "regime change" framing - including desires to rethink the balance sheet and potentially revise how the 2% inflation target is defined - is a source of deep uncertainty for fixed income and currency markets that will only intensify into the FOMC meeting.
On the geopolitical front, the Israel-Lebanon ceasefire that dominated the morning briefing proved, as so many have before it, to be partial and contested. Uncertainty about the end of the war persists and tensions in the region remain elevated. Iran said there had been no recent progress in talks with the US, and Israel's Defence Minister said Israel will continue to strike Lebanon. Oil prices have remained elevated amid the month-long ceasefire, which has included several exchanges between Iran, the US, and its allies. News reports have suggested that the US is inching closer to a deal which might extend the ceasefire, but no real peace deal has materialised. The ceasefire provided an early-session tailwind for risk assets, but its fragility became apparent through the day. LPL Financial's Head of Macro Strategy Kristian Kerr warned that investors in the oil market might be underestimating how things might shake out even after a deal materialises, saying it will take something "far more comprehensive" than an interim peace deal - noting that clear gaps remain across core issues like nuclear constraints, sanctions relief, and the longer-term framework governing transit through Hormuz.
Key Moves And Levels
Wti Crude Oil
Today's trading range for WTI futures ran between $91.97 and $95.92. WTI crude futures fell nearly 1% to around $95 per barrel on Thursday, snapping a three-day rally, as hopes for an agreement with Iran to end the conflict increased modestly. The US said that Israel and Lebanon had agreed to a ceasefire, conditional on Hezbollah also halting its attacks. By the New York afternoon the selling had extended further, with WTI pressing toward $92.87, a decline of roughly 3.3% on the session. That is a meaningful giveback from a contract that had added close to 10% over the three preceding sessions.
The morning briefing's $93.50 early warning signal was tested and broken. The break was sustained. That is a technically significant outcome, and by the framework laid out this morning, it implies the market is partially pricing in ceasefire credibility - though the contested nature of Hezbollah's compliance, combined with Israel's Defence Minister explicitly saying strikes would continue, suggests the move is more about profit-taking from an extended rally than a genuine conviction peace trade. The former neckline resistance around $94.39 has flipped to potential support. A pullback to this area could be enough to attract dip buyers looking to ride the next leg higher. The structural supply argument has not changed. EIA data showed US crude oil inventories fell for a sixth consecutive week, bringing stockpiles closer to minimum operating levels.
The forward curve is signalling something worth watching. The July 2026 contract last traded at $95.68, the August contract at $92.32, and the September contract at $88.91. That steep backwardation reflects the physical tightness at the front end and the market's assumption that some degree of normalisation will arrive over the summer. If the ceasefire story holds and Hormuz traffic recovers, that curve will flatten rapidly.
XAU/USD GOLD
Today's XAU/USD range ran from $4,424.38 to $4,477.24, with an opening price of $4,434.50. Gold reached $4,498 around 10:04 AM ET, up $66.59 or 1.5% on the session, with a day high of $4,513.99. Gold extended its recovery past the $4,500 mark per troy ounce on Thursday, with the advance coming amid the resurgence of some selling interest around the dollar, improving risk sentiment, and declining US Treasury yields across the curve.
The session produced a clean read of the gold framework described this morning. The dollar's softening on the jobless claims miss provided the mechanical lift via the -0.88 USD/CHF correlation. The $4,440 pivot identified in the morning briefing held as support during the early London hours, and gold subsequently moved through the $4,500 resistance level that the briefing had flagged as the key reclaim. That is a technically meaningful development - not a trend reversal, but a rejection of the lower end of the recent consolidation range and a partial recovery of the ground lost on Wednesday. The $4,400 structural floor, the level the briefing flagged as the signal line for trend reversal, was never threatened.
XAG/USD SILVER
Silver July futures opened at $73.08 per ounce on Thursday, June 4, down 0.8% compared to Wednesday's closing price of $73.69, before steadying around $73.60 by 7:07 AM ET. Silver's intraday performance was more contained than the morning briefing's bearish bias suggested, though the metal remained well below the previous session's high. The Nasdaq correlation expressed itself exactly as anticipated - chip stocks fell, the Nasdaq underperformed, and silver found no non-geopolitical tailwind. There was little news from the Middle East today that pushed silver prices higher, with traders awaiting meaningful progress on a peace agreement between the US and Iran that has not materialised, especially as Israel and Hezbollah have engaged in a continued conflict.
The gold-silver relationship is worth noting. Gold recovered toward $4,500 while silver remained anchored near $73.60. The divergence the morning briefing flagged as a potential trade did materialise in the sense that gold outperformed, but silver did not sell off aggressively enough to make the short a clean trade - it simply ground sideways while gold moved. That is consistent with a market where both the Nasdaq headwind and the safe-haven support are broadly balanced.
USD/JPY
The USD/JPY exchange rate fell to 159.9180 on June 4, down 0.09% from the previous session. USD/JPY sat at 159.84 yen with the dollar weakening amid higher-than-expected US initial jobless claims for last week. The 160.00 level was tested intraday during the early part of the session, approached but not convincingly broken above. The yen traded around 159.9 per dollar on Thursday, staying close to the psychologically important 160 level that investors view as a potential trigger for another round of currency intervention by Japanese authorities. The yen has now erased the gains recorded after Tokyo's 11.7 trillion yen intervention last month. Prime Minister Sane Takaichi stated that the government stands ready to respond to excessive exchange-rate movements when necessary.
Bank of Japan Governor Kazuo Ueda said the central bank should weigh the costs and benefits of raising interest rates if inflation risks begin to outweigh downside risks to economic growth. Markets continue to expect another BoJ rate hike later this month. The CFTC short-JPY positioning at the 0th percentile remains the most dangerous crowded trade in the dataset, and today's proximity to 160.00 without triggering intervention raises an uncomfortable question: either Tokyo is managing the level with greater patience than previously, or the intervention reserve is being conserved for a cleaner entry point. Neither conclusion is comfortable for short yen holders.
GBP/JPY
GBP/JPY was trading at 214.87 on the session. The pair held within its recent range, broadly consistent with the mildly bearish bias from the morning briefing. The DAX correlation worked partially - European equities did face headwinds from the Broadcom shock - but sterling showed resilience on the back of the broader dollar weakness that came with the jobless claims miss. GBP/USD regained positive momentum on Thursday and advanced toward the 1.3450-1.3460 band. Cable's bounce followed the loss of ground in the Greenback in the wake of disappointing data releases, while some improvement in sentiment around the US-Iran conflict also lent support to the risk complex. The 213.50-214.00 support held convincingly - the session never threatened it.
EUR/USD
EUR/USD gained further traction and climbed toward the 1.1650 area on Thursday, recouping part of the ground lost in the past few days. The pair's rebound came amid renewed downside pressure on the US dollar as investors remained cautious and continued to monitor developments in the Middle East for fresh directional cues. The 1.1660 breakout level that the morning briefing identified as the signal for institutional ECB positioning was tested and briefly approached. The ECB's June 11 hike, now seven days away, is providing fundamental support that continues to limit dollar-side selling in the pair. Published ECB minutes suggested some members were open to raising rates, with the central bank warning that the energy price shock had been "highly persistent." Various board officials publicly signalled that a June interest rate hike is likely.
USD/CAD
USD/CAD held near the 1.384-1.385 area, little changed on the session in overall terms though the intraday range reflected the oil volatility. With WTI down roughly 3% on the day, the natural CAD support from elevated oil diminished somewhat, providing a mild bid for USD/CAD. The pair did not break materially above 1.3720 - the upper resistance identified in the morning briefing - as the broader dollar weakness from the jobless claims print offset the oil-driven CAD headwind. The pair is essentially trapped: oil too high to push USD/CAD significantly higher, dollar too uncertain to push it significantly lower.
USD/CHF
USD/CHF was trading with a latest available rate of 0.78779. The pair behaved precisely as the gold correlation framework predicted. Gold's recovery toward $4,500 pulled CHF into demand, and USD/CHF softened from its early session levels. The -0.88 correlation operated with textbook reliability today - the jobless claims miss softened the dollar, gold bounced, and USD/CHF followed lower. The 0.7840 support referenced in the morning briefing was not tested; the pair settled comfortably in the middle of the range.
Morning Calls Review
The morning briefing's primary structural call - that the Israel-Lebanon ceasefire would drive the session and create directional uncertainty rather than a clean trend - was correct. The session was precisely that: volatile, cross-directional, and requiring reactive rather than anticipatory positioning.
On WTI, the bearish intraday bias was validated. The $93.50 early warning signal was the key call, and it broke and held. Oil fell further, ultimately closing near the $92.87-$95 range depending on measurement timing. The briefing correctly identified $93.50 as the pivot between the ceasefire being believed and dismissed, and the market gave a clear answer. The caution against chasing longs at the open was well-placed - oil's high-end for the day was $95.92, and the dominant move was lower.
EUR/USD was the briefing's cleanest directional call, and it partially delivered. The suggested long entry at 1.1590-1.1610 was relevant during the early session, and the pair recovered toward 1.1650, approaching but not yet cleanly breaking the 1.1660 target. The stop at 1.1570 was not triggered. Subscribers who entered on the pullback to the lower boundary of the range would be sitting on partial profits with the ECB hike still a week away.
Gold's $4,440 pivot call was accurate. The metal found intraday support in that zone and subsequently recovered through $4,500, which the briefing identified as the resistance to reclaim. The guidance to not trade against the direction of the first clean one-hour London candle was pertinent - gold's direction through the session was cleanly to the upside, with the jobless claims miss providing the catalyst.
USD/JPY did not trigger the 160.00 intervention signal. The pair approached the level intraday but pulled back on the claims data, closing near 159.84. The advice not to add to yen shorts above 159.50 was correct - the pair offered no follow-through above that zone and the jobless miss briefly put it under pressure. The asymmetry toward yen strength remains structurally intact.
Silver's bearish intraday call was broadly right in direction but the magnitude was muted. The Nasdaq did underperform, confirming the correlation thesis, but silver absorbed the pressure better than the most bearish scenario would have suggested. Those who stayed flat on silver rather than shorting into the open avoided a choppy, low-conviction range trade.
The fourth "surprise" scenario cited in the briefing - Kevin Warsh's narrative gaining traction in the European session - had a partial echo in today's IMF statement, which explicitly called on Warsh to stay cautious on rates ahead of the June FOMC. That was a real intraday catalyst for the fixed income market and added to gold's recovery.
Positioning Into Tomorrow
Friday's nonfarm payrolls report is the session-defining event. With May nonfarm payrolls due at 8:30 AM ET Friday, some of today's selling might represent consolidation ahead of the number. Analysts think the economy created 85,000 jobs, which would be historically light and down from 115,000 in April. That consensus has shifted modestly below the 105,000 figure cited in the morning briefing, and today's jobless claims miss reinforces the possibility of a genuinely soft print. It would still be the third straight month of job gains for the first time in a year.
The binary nature of tomorrow's print cannot be overstated. A number near or below 85,000 - particularly if accompanied by upward revisions to the unemployment rate from 4.3% - would reprice Fed expectations rapidly, compress the dollar, and send gold and yen sharply in the direction of an unwind. The CFTC's 0th percentile JPY short means that squeeze, if it comes, will not be orderly. Conversely, a print above 120,000 would reverse today's dollar softness immediately and put USD/JPY back at 160.00 within the hour.
Shipping through the Strait of Hormuz has remained subdued since the conflict began, though reports suggest traffic through the waterway has picked up over the past two weeks, with some vessels operating in coordination with the US military, though volumes remain well below pre-conflict levels. Any overnight development on the ceasefire front - either Hezbollah's formal compliance being confirmed, or an Israeli strike on Lebanon resuming in force - will move oil before London opens.
The Asia session opens with USD/JPY parked just below 160.00 and Tokyo authorities on verbal warning status. Investors are pricing in roughly a 78% probability that the Bank of Japan will raise interest rates again later this month. If the Nikkei opens lower on the Broadcom overhang and safe-haven yen flows accelerate, the Ministry of Finance will face its most direct test of the week before Friday's NFP data changes the landscape entirely.
The IMF's call on Thursday for the Fed under Warsh to stay cautious on rates - released just hours ago - will be processed further by bond markets in Asia overnight. Combined with the claims miss, it reinforces the view that the Fed has less room to act hawkishly than the ADP and ISM data suggested on Wednesday. Watch the 10-year Treasury yield overnight; if it slips below 4.40%, the dollar will struggle into the NFP print regardless of what the geopolitical tape does.
Canada also releases employment data alongside the US NFP at 13:30 UK time on Friday. With oil down on the session and the CAD short position large on CFTC data, a strong Canadian employment print into a weak US payrolls environment would be a particularly sharp squeeze for USD/CAD.
Markets Mastered - Today's Takeaway
Today's rotation - Dow to fresh records while the Nasdaq flatlined - is the market telling you that the AI exceptionalism trade is entering a more selective phase, where execution matters as much as narrative.
The Israel-Lebanon ceasefire did exactly what the morning briefing said it would: moved oil without resolving anything, leaving the Hormuz question entirely intact and creating only a partial, contested geopolitical premium compression.
Gold's recovery from $4,424 to $4,513 on the back of the jobless claims miss and the IMF's anti-hawkish Warsh statement is the clearest read of the day - rate expectations, not geopolitics, are now the dominant input for gold in the near term.
Tomorrow's NFP number is the week's master switch: everything you have observed this week - oil positioning, yen shorts, EUR/USD setup, gold's tentative recovery - resolves or reverses in the 30 minutes following the 13:30 UK print.