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

markets breaking news editor Amanda Cooper.)

By Amanda Cooper

LONDON, June 5 (Reuters) - What matters in U.S. and

global markets today by EMEA markets breaking news editor Amanda

Cooper.

Intro

Donald Trump's "One Big Beautiful Bill" is heading towards a

final yes-or-no vote this morning, after House Republicans

advanced the U.S. president's landmark tax but and spending

legislation. Markets are in something of a holding pattern ahead

of monthly jobs data tomorrow, while UK bondholders are

recovering after a nasty reminder of what concern about the

long-term fiscal picture can do to government borrowing costs.

Mike Dolan is enjoying some well-deserved time off over the

next two weeks, but the Reuters markets team is here to provide

you with all the information you need to start your day.

Today's Market Minute

* Republicans in the House of Representatives advanced U.S.

President Donald Trump's massive tax-cut and spending

bill toward a final yes-or-no vote early Thursday morning,

appearing to overcome internal party divisions over its cost.

* Big investors are mobilising to trade through weeks packed

with wild-card events that may shatter the calm in stock markets

and drive big swings for assets they see as exposed to both

positive or negative surprises, from gold to corporate credit.

* The U.S. has lifted restrictions on exports to China for chip

design software developers and ethane producers, a further sign

of de-escalating U.S.-Sino trade tensions including concessions

from Beijing over rare earths.

* The tariff deal between the United States and Vietnam will

impact the energy generation mix that powers the fast-growing

Vietnamese economy, says ROI columnist Gavin Maguire.

*Is gold the next metal to be added to the list of "critical

minerals"? ROI columnist Clyde Russell argues that gold may not

be a vital component of advanced manufacturing, but the precious

metal appears to be undergoing a subtle shift in how it is

viewed by governments and investors.

The bond vigilantes are resting, for now

As the OBBB heads towards approval, it might be time for

investors to think about what the fiscal implications are. The

bill, which guts a number of key social benefits for some of the

poorest Americans to pay for tax cuts, cleared a final

procedural hurdle needed to begin debate on its content, with a

final vote expected today.

Non-partisan analysts say the bill will add $3.4 trillion to

the nation's $36.2 trillion debt pile over the next decade. When

Trump started floating the basics of the bill on the campaign

trail last year, bond yields began to grind higher, reaching a

peak of 4.8% around the time he took office in January, as

investors began to price in the impact of the legislation on the

country's already-strained finances.

Benchmark 10-year Treasuries are currently yielding 4.25%,

but they're up from around 3.6% last September, as the

presidential race heated up, despite a jumbo half-point cut from

the Federal Reserve.

The damage to 30-year notes has been even more severe.

Thirty-year yields, the benchmark for mortgage rates, have risen

to 4.8%, from below 4% in the same timeframe.

Pressure from Trump on Fed Chair Jerome Powell to cut rates

has not let up, including numerous insults like calling him "too

late" and "an average mentally person". But his latest social

media post, calling for Powell to "resign immediately", has

barely caused a stir in the markets.

There's no doubt that anticipation around today's non-farm

payrolls data is white-hot.

Right now, traders are placing a 25% chance on the Fed

cutting rates at the July meeting. They see at least two rate

cuts over the remaining four meetings this year, which suggests

that an NFP print that falls short of the expected 110,000 is,

to an extent, baked in.

An index of U.S. economic surprises has fallen to its lowest

in nine months in the last week, because data has generally

missed expectations. An upside surprise in payrolls is generally

not that common either. In the last year, the initial reading

has only beaten expectations half the time. Beats and misses in

other employment surveys are also not reliable indicators of

what to expect from the more comprehensive government report.

Investors around the world are becoming less indulgent of

governments' increasingly strained long-term finances, as

deficits balloon and economic growth wobbles. As a result,

long-term bond yields tend to bear the brunt of any concern they

have, as witnessed in Wednesday's rout in the UK gilt market.

The British government's U-turn on its proposed welfare

reform now means finance minister Rachel Reeves is at risk of

busting her own self-imposed fiscal rules. The sight of a

clearly upset Reeves in parliament, on TV, was enough to ignite

one of the worst selloffs in 10-year gilts this year, which at

one point, rivalled that of 2022.

Bond market reaction to Trump's bill may be muted for now. A

massive spike in yields is no laughing matter, so it's worth

remembering the bond vigilantes aren't dead, they're just

resting.

Chart of the day

The chance of the Fed delivering its first rate cut of 2025

this month have crept up to 25% from next to nothing just a few

weeks ago. The data paints a picture of an economy that is

slowing, but one where growth is not falling off a cliff,

particularly as the labour market has continued to hold up. The

June employment report could move the needle on those July

odds.

Today's events to watch

* June U.S. non-farm payrolls data

* U.S. weekly jobless claims

* May U.S. international trade

* U.S. June S&P Global final composite PMI

* Institute for Supply Management non-manufacturing PMI

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.

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