Daily Fundamental Analysis: US Retail Sales Fall in May, Stocks Decline Ahead of Fed’s Meeting

Japan’s exports fell 1.7% year over year in May, below economist expectations but reversing April’s 2% gain. Data shows U.S. exports down 11.1% and China exports down 8.8%. Auto exports fell 6.9% globally, with U.S.-bound vehicles dropping 24.7%.

The Bank of Japan’s policy statement warned of moderate growth due to trade impacts on overseas economies and corporate profits. And Asian markets were mixed Wednesday amid Israel-Iran tensions.

In Japan, the Nikkei 225 rose 0.47%, Topix gained 0.4%, while South Korea’s Kospi and Kosdaq added 0.7% and 0.66% respectively. Australia’s S&P/ASX 200 remained flat, while Hong Kong’s Hang Seng dropped 0.87% and China’s CSI 300 edged up 0.18%.

U.S. President Donald Trump is considering military action against Iran and demanding their surrender, according to U.S. officials.

U.S. futures declined ahead of the Fed’s rate decision. Major indices closed lower, with the Dow Jones down 0.70%, S&P 500 falling 0.84%, and Nasdaq dropping 0.91%.

Fed officials will share their views this week on interest rates, tariffs, and Middle East impacts. While no immediate rate changes are expected, Wednesday’s policy meeting could provide market-moving signals.

Key focus areas include whether the Fed maintains its two-rate-cut forecast, inflation outlook, and Chair Jerome Powell’s response to White House pressure for looser policy.

In the crypto market, bitcoin fell almost 4% yesterday, but it’s recovering today as prices went back above $105,000 level. The Senate passed the GENIUS Act on Tuesday, establishing federal oversight for U.S. dollar-pegged stablecoins.

And in the Forex market, the US dollar rose against major currencies as no rate cuts are expected in today’s Fed meeting. EURUSD fell 0.74% and GBPUSD dropped more than 1%