Things have been pretty chaotic in the US recently. First, the public showdown between Donald Trump and Elon Musk dragged down Tesla stock, briefly putting pressure on the major U.S. indexes, including the S&P 500 and Nasdaq. Now tensions are heating up in Los Angeles, and this time not because of wildfires, but because of mass protests against the deportation of undocumented immigrants.   

California Governor Gavin Newsom criticized the measure and said it had been carried out without his knowledge. He called it a “deliberate provocation” and accused Trump of “sowing chaos to win politically.” According to Newsom, this is not about national security but an election campaign tactic to divide and incite people. Trump, on the other hand, points the finger at the radical left for stirring things up. 

While protests and political clashes dominate headlines, traders seem more focused on economic signals, starting with today’s U.S.-China trade negotiations in London. It is unclear whether they will yield the desired results, but the fact that China has approved the export of rare earths - a key material for industries such as robotics and EVs - could be a sign that the country is willing to budge.   

Investors will also be looking for consumer price data this Wednesday, followed by the Producer Price Index (PPI) on Thursday. This data will show whether Trump's tariffs are fueling inflation in the US. A noticeable rise could prompt the Fed to resist cutting interest rates. The central bank, torn between maintaining price stability and managing the still-strong labor market, has very little room for error.        

Finally, there is also a 30-year government bond auction this week. Yields on those remain near the critical 5% mark. As for what is driving up the government's borrowing costs, besides Trump's trade wars, investors fear that the new budget now being discussed by lawmakers could further increase the national debt. If talks with China break down, demand for U.S. debt could plummet and market confidence.      

On the corporate side, Apple is hogging the spotlight with its annual developer conference, which runs June 9-13. The company is expected to unveil a long-awaited AI strategy, which could finally shake its recent slump compared to rivals like Microsoft, Google, and Nvidia. A positive surprise in the announcement could lift the entire tech sector, given Apple's weight in major indices.