(The opinions expressed here are those of the author, a

columnist for Reuters.)

By Mike Dolan

June 8 (Reuters) -

What matters in U.S. and global markets today

By Mike Dolan, Editor-at-Large, Finance and Markets

Wall Street is holding its breath after Friday's withering chip

sector selloff, as tech stocks around the world fell back

sharply in response on Monday.

Red-hot chip stocks have been knocked back by a combination of

last week's earnings disappointment from Broadcom, a loss of

momentum as the S&P 500's nine-week winning streak came to an

end, and rising Fed rate-hike bets after Friday's robust May

payrolls report.

I'll get into that and more below.

But first, listen to the latest episode of the Morning Bid daily

podcast. Subscribe to hear Reuters journalists discuss the

biggest news in markets and finance seven days a week.

CHIP CHILL, JOBS HEAT AND WAR

The SOX semiconductor index plunged 10% on Friday alone, with

Broadcom itself down 20% over two days and the broader Nasdaq

off some 4% heading into the weekend. Futures tried to grab a

toehold first thing on Monday, but tech-heavy Asia bourses

nosedived and Europe's STOXX 600 slid to a two-week low.

Adding to the angst, Iran and Israel traded direct missile

strikes over the weekend for the first time since April,

catapulting crude oil prices back up over 4% and aggravating

rate-hike expectations. Markets now see an almost 80% chance of

a hike by year-end and almost two hikes within 12 months.

Treasury yields are back on the rise.

All this had President Trump fighting multiple fires over the

weekend, urging against interest rate rises and renewing calls

for cuts instead. At the same time, his call on Israel not to

retaliate against Iranian strikes on Sunday went unheeded. The

fresh fighting dampens hopes of a comprehensive peace deal that

would free up oil supplies.

With equity markets resetting as they take in all the new

information, they're also bracing for the mega SpaceX IPO, which

is expected on Friday.

While analysts reckon the wave of IPOs expected this summer can

likely be offset by a record pace of buybacks, there is concern

about a parallel wave of equity financing by the so-called

hyperscalers amid the gigantic AI investment buildout. Alphabet

announced some $80 billion of new equity sales last week and

there are reports Meta is set to follow suit.

Meantime, in Europe, markets are bracing for a long-awaited

European Central Bank rate rise on Thursday. Despite this, the

dollar has strengthened against the euro on the changing Fed

horizon.

Chart of the day

The U.S. economy posted a third straight month of strong job

gains in May, with payrolls increasing by 172,000, more than

twice what was forecast. The economy also added 93,000 more jobs

in March and April than previously estimated, and the

unemployment rate held at 4.3% for a third month. Employment

gains averaged 188,000 jobs per month over the past three

months, nearly triple the comparable figure for the same period

in 2025.

Concern about overheating stems from estimates that the

economy needs to create between zero and 50,000 jobs a month to

match growth in the working-age population - a so-called

breakeven rate that has been sharply reduced by the crackdown on

immigration over the past year.

Today's events to watch

* U.S. Conference Board Employment Trends Index for May (10

a.m. EDT)

Want to receive the Morning Bid in your inbox every weekday

morning? Sign up for the newsletter here. You can find ROI on

the Reuters website, and you can follow us on LinkedIn and X.

Opinions expressed are those of the author. They do not reflect

the views of Reuters News, which, under the Trust Principles, is

committed to integrity, independence, and freedom from bias.