To The Moon

Due to economic data laying the groundwork for interest rate cuts, Wall Street ended a turbulent month on a high note; the Hong Kong Hang Seng Index hit a 7-week high, driven by electric vehicle manufacturers.

🇺🇸 S&P 500 Index: +1.02% 📈

🇺🇸 Nasdaq: +1.13% 📈

🇪🇺 Stoxx 600 Index: +0.09% 📈

🇯🇵 Nikkei 225 Index: +0.74% 📈

🇭🇰 Hang Seng Index: +1.14% 📈

🇨🇳 CSI 300 Index: +1.33% 📈

U.S. stocks rose on Friday, with the S&P 500 Index and the Nasdaq Composite Index up by 1.0% and 1.1%, respectively, as investors closely analyzed key inflation data monitored by the Federal Reserve.

The U.S. Core PCE Price Index, the Fed's preferred inflation gauge excluding energy and food prices, remained unchanged from June, rising 2.6% year-over-year in July 2024 (compared to a market expectation of 2.7%), setting the stage for a potential rate cut in September.

The Michigan Consumer Sentiment Index rose for the first time in five months, from 66.4 in June to 67.9 in July, as slower inflation and the prospect of Fed rate cuts helped boost expectations for personal finances.

The EU Core CPI decreased from 2.9% in July to 2.8% in August, in line with expectations, while the unemployment rate dropped from 6.50% in June to 6.40% in July, signaling a potential rate cut by the European Central Bank in September.

Japan's unemployment rate increased from 2.5% in June to 2.7% in July (expected 2.5%), marking the first deterioration in five months as more workers left their jobs in search of better conditions.

Japanese industrial production grew by 2.7% year-over-year in July, reversing the 7.9% drop in June and achieving the strongest growth since January 2023, driven by increased production of semiconductor and electrical equipment.

Japanese retail sales grew by 2.6% year-over-year in July (expected 2.9%), down from 3.8% in June, but continued wage increases supported consumption, marking the 28th consecutive month of positive retail sales growth.

Asia-Pacific markets rose, with the Hong Kong Hang Seng Index and the Shanghai CSI 300 Index up 1.1% and 1.3%, respectively. Investors bought shares in Chinese electric vehicle manufacturers such as Li Auto, Xpeng, and BYD following recent sell-offs, as positive signs in the U.S. economy improved market sentiment.

China's National Bureau of Statistics Manufacturing PMI contracted for the fourth consecutive month, dropping from 49.4 in July to 49.1 in August, affected by extreme weather, seasonal production slowdowns in some industries, insufficient demand, and commodity price fluctuations.

💡 Upcoming Events: 💡

On Monday, we will see the release of the EU HCOB Manufacturing PMI Final, Japan Jibun Bank Manufacturing PMI Final, China Caixin Manufacturing PMI, and Malaysia S&P Global Manufacturing PMI.

U.S. ISM and S&P Global Manufacturing PMI will be released on Tuesday.

On Wednesday, data will include U.S. JOLTs Job Openings, YoY Exports, EU HCOB Services PMI, Japan Jibun Bank Services PMI, and China Caixin Services PMI.

💡 Things to Know Today: 💡

1. Intel $Intel(INTC)$  is exploring various strategic options with Morgan Stanley and Goldman Sachs, including splitting its product design and foundry businesses or abandoning some factory projects, as it faces increasing losses and struggles to turn its business around.

Intel

2. Marvell Technology $Marvell Technology(MRVL)$  reported that its data center sales grew 92% year-over-year in Q2 of FY 2025, driven by the integration of Marvell's 1.6T optical DSP into Nvidia's Blackwell GPU $NVIDIA Corp(NVDA)$ , Amazon's Trainium 2 AI processors $Amazon.com(AMZN)$ , and Google's Axion CPU $Alphabet(GOOGL)$  .

Marvell

3. China's video game market is expected to reach $45 billion in 2024, with strong demand for Tencent-supported Game Science's action role-playing game "Black Myth: Wukong" anticipated to drive consumer spending.

Wukong

4. Beijing's policy measures, including reductions in loan base rates and potential mortgage refinancing plans, are expected to further pressure the net interest margins (NIM) of China's state-owned banks, including ICBC and China Construction Bank, before 2025.

✅ Key Takeaways:

Last week, U.S. markets were mixed. Nvidia's sharp decline of -8% led to minimal changes in the S&P 500 Index and small caps, while cyclical, defensive, and utility sectors rose. This highlights the challenge of markets being significantly influenced by a few key stocks. However, recent economic data supports a balanced risk appetite/risk aversion sentiment and enhances prospects for a soft landing and reflation.

@Daily_Discussion  @TigerStars  @Tiger_comments  @CaptainTiger  @MillionaireTiger  @TigerGPT