To The Moon

U.S. Equities Wrap

Wall Street closed lower on August 29, though all three major indices still managed to post gains for the week. Market expectations for a September rate hike by the Federal Reserve edged higher, with traders now pricing in a greater likelihood of tightening.

Among the top 20 most-traded stocks on August 28, NVIDIA surged roughly 9% to lead the Nasdaq higher, while Salesforce jumped over 22%. Meanwhile, Chinese ADRs were mixed on August 28, with Baidu climbing about 4% and Alibaba slipping nearly 3%.

Commodities Overview

Oil prices recorded a weekly decline, while copper notched a ninth consecutive week of gains. Gold took a sharp hit, falling significantly during the session.

European Markets

European equities advanced, with the automotive sector leading the charge as investor sentiment improved across the region.

Macro Developments

President Trump signed an executive order to establish a "Space Academy" aimed at cultivating aerospace talent. In a separate statement, Iran's president said internal consensus had been reached regarding the Strait of Hormuz shipping routes.

Trump also proposed allowing farmers and ranchers to process food themselves in an effort to lower beef prices. Meanwhile, U.S. negotiators are reportedly seeking control over Venezuela's 900 billion barrels of oil reserves, with discussions covering 17 oil fields.

Ahead of the midterm elections, the U.S. House Speaker plans to meet with major Republican donors in Texas, including Elon Musk. The Defense Secretary is expected to convene senior U.S. military officers for another round of briefings. Additionally, Chile, Argentina, Bolivia, and Peru signed a key minerals cooperation agreement.

Corporate Headlines

Apple raised subscription prices for Apple TV and Apple One in the U.S. market. Chevron is reportedly planning to expand its operations in Venezuela, with other U.S. energy firms also exploring investment opportunities there.

Microsoft executives reassured employees internally that data centers hold positive social value. NVIDIA is participating in a funding round for AI cloud provider Lambda, which aims to raise $1 billion through private short-term debt to purchase GPUs for leasing to Microsoft.

The Pentagon is in talks with a Venezuelan tycoon over a massive oil deal, a move that could spark legal controversy. After 20 years in business, a cookie bakery chain has closed all its physical stores.

Commentary and Analysis

The U.S. Treasury yield curve has flattened notably, as Warsh's anti-inflation commitments eased market concerns. Warsh also suggested that artificial intelligence could provide a strong economic boost, with the Fed closely monitoring its impact. Notably, his Jackson Hole speech made no mention of the $40 trillion national debt or historic fiscal deficits.

The yen weakened past 160 against the dollar again, erasing the effects of the last U.S.-Japan intervention. Bank of England Governor Bailey downplayed second-round inflation effects and expressed support for Warsh's views on forward guidance.

Following Fed Chair Warsh's remarks, rate hike odds have risen, making the September FOMC decision a "coin flip." Bessent defended intervention actions, arguing that disorderly yen moves could push U.S. interest rates higher.

Morgan Stanley recommends buying five "AI sovereignty" concept stocks, citing potential upside of at least 20%. European Central Bank Governing Council member Kocher noted the economy is gaining momentum, while colleague Schnabel advocated moving central bank currency onto blockchain.

U.S. Senate Democratic Leader called Trump's approach to Iran a complete failure. European bond markets saw yield curve flattening, with markets firmly expecting the ECB to hike rates by 25 basis points next month.