U.S. Treasurys climbed Monday as investors considered what could be next for interest rates and weighed key economic data that could affect the Federal Reserve’s next policy moves.

Uncertainty about whether the central bank will pause its rate-hiking campaign when it meets later this month has spread, owing to mixed messages from Fed officials and economic data reflecting resilience in the labor market.

At 4:36 a.m. ET, the yield on the 10-year Treasury was up by over four basis points to 3.737%. The 2-year Treasury yield was trading at 4.5389% after rising by more than three basis points.

— Sophie Kiderlin

Japan’s service sector saw a record rate of expansion in May, according to private surveys by au Jibun bank.

The country’s services purchasing managers’ index came in at 55.9, surpassing the previous record of 55.4 set last month and extending its streak to six straight months of quickening expansion.

The bank wrote that “anecdotal evidence suggested that the increase in customer demand was sustained as the impacts of the Covid-19 pandemic continued to wane.”

It also added that firms’ outlook for business activity remained “strongly optimistic,” with “particular emphasis placed on the strength of the tourism sector.”

— Lim Hui Jie

In May, Hong Kong’s private sector expanded at its slowest rate this year, according to a private survey by S&P Global. The city’s composite purchasing managers’ index fell to 50.6 in May from 52.4 in April.

The PMI index encompasses services and manufacturing, and is seen as a reliable gauge of economic health. A reading above 50 indicates expansion, while a reading below 50 indicates contraction.

S&P Global said the recent boost to growth in Hong Kong, from the full resumption of travel between the city and mainland China, “was beginning to wane.”

The survey pointed at signs — such as lower new sales, slower new order growth and higher input cost inflation — putting pressure on firms’ margins.

— Lim Hui Jie

China’s private Caixin Services purchasing managers’ index (PMI) reached 57.1 in May, inching higher to the second-highest rate since November 2020.

The reading saw a recent peak of 57.8 in March, rebounding from a recent low of 46.7 in November as the economy emerged from China’s stringent Covid restrictions.

The upturn coincided with a steeper increase in total new orders and sustained rise in new export business amid reports of stronger market conditions and increased customer turnout, Caixin said in a Monday release.

May’s services PMI marked the fifth consecutive month of an expansionary reading above the 50-mark that separates growth and contraction, as services remain a bright spot in China’s uneven economic recovery.

“Service providers remained optimistic partly because the market environment improved in the post-Covid era,” Wang Zhe, Senior Economist at Caixin Insight Group said.

— Jihye Lee

Oil prices rose after OPEC kingpin Saudi Arabia decided to cut production by another million barrels per day.

Global benchmark Brent futures were up 2.4% at $78 a barrel Monday during early Asia trade, while U.S. West Texas Intermediate futures rose 2.5% to $73.53 per barrel.

“The market did not widely expect the Saudi decision to cut production by 1 million barrels per day unilaterally,” president of Rapidan Energy Bob McNally told CNBC in an e-mail following the decision.

“It once again demonstrated that Saudi Arabia is willing to act unilaterally to stabilize oil prices,” McNally said.

—Lee Ying Shan

Despite all talk of the “Magnificent 7” tech stocks driving 2023 gains, Friday’s market rally was broad.

Beyond tech, the S&P 1500 regional bank index surged 5.5% Friday.

The Russell 2000 Index of small cap stocks rallied 3.6%, both far outperforming the 1.5% gain in the S&P 500. Almost six stocks advanced on the New York Stock Exchange for every one that fell.

The Russell also closed above its 200-day moving average level of 1,812.99 for first time since Mar. 8. Small caps closed 3.56% higher for their best day since Nov. 10.

— Tanaya Macheel, Scott Schnipper

Stock futures were flat to begin trading on Sunday evening. Dow Jones Industrial Average futures added 13 points, or 0.04%. S&P 500 futures were 0.01% higher. Nasdaq 100 futures were 0.01% lower.

— Tanaya Macheel