* Israel opposition parties strike deal to oust Prime Minister Benjamin Netanyahu
* Global employment recovery to prepandemic level will take years
* Congress considering new policies to ease labor shortage
* Fed to begin winding down program that bought corporate assets
* A United Nations gauge of world food costs rose for 12th straight month in May
* Will oil prices continue rising this summer?
* China growth eased in May via Composite PMI, a survey-based GDP proxy
* Economy growing at moderate pace, Fed’s Beige Book reports
* CRB Commodity Index closes at 6-year high:

They’re alive! They’re alive! Emerging markets stocks are alive! Or so it seems.

After languishing in a trading range for weeks, Vanguard FTSE Emerging Markets (VWO) surged in the past two days, ending today’s session (June 2) at the highest level since February. Is it risk-on for EM?

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The Global Market Index’s (GMI) expected risk premium held steady at 5.9% annualized in May, matching the previous month’s estimate. The forecast — performance above the “risk-free” rate – remains well below the realized risk premium in recent history, based on rolling 10-year annualized results.

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* First human case of H10N3 bird flu reported in China
* World’s largest meat supplier is latest victim of ransomware attack
* OPEC+ oil producers agree to stick to gradually ease supply curbs
* Biden suspends oil drilling in Alaska’s Arctic refuge
* Malaysia charges China breached airspace over South China Sea.
* Will Friday’s jobs report upend Biden’s economic agenda?
* Has the bet on inflation peaked?
* US manufacturing activity strengthened in May via ISM Mfg. Index
* US construction spending rose less than expected in April
* Global manufacturing activity rose to highest level in 11 years in May:

The major asset classes delivered across-the-board gains for a second month in a row in May. Excluding cash, everything was up last month, led by a sizzling rally in foreign inflation-linked government bonds.

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* Will this week’s jobs report for May change the Fed’s stance on monetary policy?
* The perfect storm for a shortage in everything around the world
* China’s manufacturing sector grew at slightly slower pace in May
* Eurozone manufacturing activity reached new highs in May
* US crude futures rise to 2-1/2 year high
* Key measure of US inflation increased faster than expected in April
* US consumer spending rose 0.5% in April, extending March’s surge
* Probability of expected US PCE inflation above 2.5% rose to 84% in May:

Keeping up with the benchmark remains challenging this year for our trio of proprietary strategies. Global Beta 16 (G.B16), which routinely holds all 16 funds in the targeted global opportunity set, is up 8.7% year to date. That’s modestly ahead of two of the prop portfolios and far ahead of a third. (Note that all three prop strategies and the benchmark use the same 16-fund opportunity set; the only difference is in the risk-on and risk-off signals.) For details on strategy rules and risk metrics in the tables below, please see this summary.

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● Trading at the Speed of Light: How Ultrafast Algorithms Are Transforming Financial Markets
Donald MacKenzie
Summary via publisher (Princeton U. Press)
In today’s financial markets, trading floors on which brokers buy and sell shares face-to-face have increasingly been replaced by lightning-fast electronic systems that use algorithms to execute astounding volumes of transactions. Trading at the Speed of Light tells the story of this epic transformation. Donald MacKenzie shows how in the 1990s, in what were then the disreputable margins of the US financial system, a new approach to trading—automated high-frequency trading or HFT—began and then spread throughout the world. HFT has brought new efficiency to global trading, but has also created an unrelenting race for speed, leading to a systematic, subterranean battle among HFT algorithms.

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In this issue:

• Winners across the board for global markets this week
• A win-win for our portfolio strategy benchmarks, too

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