Investors Pull Back on Rate Cut Expectations, Asian Equities Slide

China's services sector expanded at its fastest pace in three months, according to a private survey, indicating a rebound in domestic demand as the country recovers from the impact of the COVID-19 pandemic. The Caixin/Markit services purchasing managers' index (PMI) rose to 54.9 in May, up from 54.7 in April, with a reading above 50 indicating expansion. This growth was driven by a surge in new orders and increased business confidence, although employment in the sector continued to decline.