Core Viewpoint - The Bank of Japan has decided to maintain interest rates but unexpectedly announced the initiation of ETF sales, leading to a decline in Asian stock markets and halting the record global stock rally [1][2]. Group 1: Bank of Japan's Actions - The Bank of Japan's announcement to start an ETF selling plan is reminiscent of the early 2000s when it disposed of stocks purchased from banks [2]. - Despite maintaining interest rates, the asset sale plan has put immediate pressure on the Japanese market, causing the Nikkei 225 index to lose all earlier gains [2]. - The two-year Japanese government bond yield has risen to its highest level since 2008, indicating traders are pricing in a potential interest rate hike in October [2]. Group 2: Market Reactions - The U.S. stock market saw Intel drop over 2%, while FedEx rose over 5% due to positive first-quarter earnings and future growth projections [4]. - European stock indices opened higher, with Germany's DAX30 up 0.24%, the UK's FTSE 100 up 0.03%, and France's CAC40 up 0.26% [4]. - The U.S. dollar index has rebounded from a low of 96.22 to 97.46, influenced by market interpretations of Federal Reserve policies [2][3]. Group 3: Economic Indicators - Initial jobless claims in the U.S. decreased last week, reversing the previous week's increase, which supported the rise of the dollar and U.S. Treasury yields [3]. - The 10-year U.S. Treasury yield increased by 2 basis points to 4.131% [4][7]. - The Indian rupee faced pressure, nearing historical lows, with a trading rate of 88.30 against the dollar [4].

Market Movements - US stock index futures are all up ahead of the market opening, with Dow futures up 0.02%, S&P 500 futures up 0.18%, and Nasdaq futures up 0.22% [1] - European indices are down, with Germany's DAX down 0.54%, UK's FTSE 100 down 0.26%, France's CAC 40 down 0.15%, and the Euro Stoxx 50 down 0.16% [2][3] - WTI crude oil is up 0.54% at $63.64 per barrel, while Brent crude oil is up 0.34% at $67.67 per barrel [3][4] Economic Data - US retail sales for August are expected to show a month-on-month increase of 0.2%, with core retail sales (excluding autos and gas) expected to rise by 0.4%, indicating consumer spending may be a bright spot despite overall economic weakness [4] Company News - Oracle (ORCL.US) shares are up over 5% in pre-market trading as it is reported to be participating in a consortium to maintain TikTok's operations in the US [7] - Tesla (TSLA.US) is under investigation by the National Highway Traffic Safety Administration regarding potential issues with the electronic door handles of certain Model Y vehicles [8] - Nvidia's (NVDA.US) new RTX6000D chip for the Chinese market is facing low demand, with major companies showing little interest due to high pricing and perceived lack of value [8] - TSMC (TSM.US) has seen its market share in the semiconductor foundry market rise to 38% in Q2 2025, driven by strong AI demand and Chinese subsidies [9] - Google's (GOOGL.US) proposal to divest part of its advertising technology business has been rejected by the Justice Department, which is seeking a complete separation of its AdX platform [9] - Corteva (CTVA.US) is reportedly evaluating a potential split of its seed and pesticide businesses, but this move has raised concerns among Wall Street analysts [10] - Webtoon (WBTN.US) shares surged over 39% in pre-market trading after Disney (DIS.US) announced a partnership to develop a digital platform for classic comic content [10]

Group 1 - The S&P 500 index has seen a cumulative increase of over 31% in the past five months, marking one of the strongest rebounds in nearly 20 years, second only to the rebounds during the 2008 financial crisis and the pandemic [1] - Investors in major U.S. index-tracking ETFs experienced significant gains last week, driven primarily by expectations of an interest rate cut by the Federal Reserve and strong earnings reports from companies involved in artificial intelligence (AI) [3] - Oracle's earnings report, which exceeded expectations and provided a confident outlook, led to a surge in its stock price by over 40%, significantly impacting the financial markets and making its founder the world's new richest person [3] Group 2 - Despite many analysts asserting that a market bubble exists, the stock market continues to rise, prompting comparisons between the current AI boom and historical booms in railroads, telecommunications, and shale oil [5] - Multiplo Invest believes that the current era is witnessing a genuine industrial revolution driven by AI, which is expected to enhance productivity and fuel economic growth [6] - The comparison of ChatGPT to the launch of Netscape highlights the potential for further asset price increases, suggesting that investors who focus solely on the notion of a bubble may miss out on opportunities [9][11] Group 3 - Multiplo Invest emphasizes the high likelihood of the Federal Reserve initiating an interest rate cut, with historical data showing that the S&P 500 index has averaged a 9.8% increase in the 12 months following such cuts when the market is near all-time highs [12] - The current S&P 500 index is approximately 6,600 points, and if the average increase of 9.8% is applied, the target for the index could reach 7,247 points by September 2026 [14] - The firm maintains a bullish outlook on major U.S. indices, reiterating a buy recommendation for S&P 500 and similar assets [20]

Group 1: Federal Reserve and Market Reactions - The Federal Reserve meeting may act as a catalyst for a short-term strengthening of the US dollar, especially given its recent consolidation since early July [1] - Concerns arise that the meeting could trigger a "news sell-off" due to heightened market bubbles, potentially limiting upside and exacerbating downside trading [1] - The US 60/40 stock/bond portfolio has achieved its highest percentile return since April 8, indicating a fatigue in current stock and fixed income levels [1] Group 2: Market Performance - The US stock market is rising, led by technology stocks, with the Nasdaq index experiencing its best single-day gain in nearly two years [2] - The Stoxx Europe 600 index closed up 0.4%, with consumer goods and banking stocks performing well, while healthcare stocks lagged [2] Group 3: Bond Market Trends - US bond yields have decreased ahead of the Federal Reserve meeting [3] - European sovereign bond yields also fell, with strong demand for corporate bonds [4] - Investment-grade corporate bonds are at their highest level of technical overbought conditions since early 2020 [5] Group 4: Currency and Commodity Movements - The US dollar is declining, with Deutsche Bank noting that overseas investors are significantly reducing their dollar exposure while purchasing US stocks and bonds [6] - Gold prices are reaching new historical highs as the Federal Reserve is expected to lower interest rates [6] - Oil prices continue to rise as traders consider further sanctions on Russian oil in response to anticipated oversupply later this year [6]

Market Overview - The A-share market experienced a collective decline today, with the Shanghai Composite Index down 0.45% to 3858.13 points, the Shenzhen Component down 2.14% to 12553.84 points, and the ChiNext Index down 2.85% to 2872.22 points [2][3] - The total trading volume in the Shanghai and Shenzhen markets reached 28,750 billion, an increase of 1,250 billion compared to the previous day [2][3] Individual Stock Performance - Despite the limited decline in major indices, individual stocks faced significant losses, with approximately 4,048 stocks declining by a median drop of about 1.5% [3] - Key stocks such as Industrial and Commercial Bank of China rose by 2.57%, and China Merchants Bank increased by 3.48%, leading the banking sector to a 1.69% gain [3][4] Sector Performance - The telecommunications sector experienced the largest decline, down 5%, followed by semiconductor and power equipment sectors, which fell by 4.47% and 4.20%, respectively [5] - The top ten declining sectors are predominantly from the TMT (Technology, Media, and Telecommunications) field, with a total capital outflow of 979 billion [5] Capital Flow - The total outflow of main funds from the two markets reached 1,721 billion, marking a record level, with northbound funds seeing a significant outflow of 1,531 billion [5] - The margin financing balance reached a new high of 2.3 trillion, raising concerns about whether leveraged funds will turn bearish [5] Market Sentiment - The current market sentiment indicates a bubble, with average price-to-earnings ratios in micro-cap stocks, the CSI 2000, and the ChiNext at historical highs [8] - The protective actions of the Shanghai 50 index have somewhat masked the outflow of funds, suggesting a disconnect between market performance and underlying fundamentals [8]

Market Overview - The Chief Investment Officer of Lianhua Asset Management, Hong Hao, identifies two key indicators for market assessment: the market capitalization to GDP ratio and the margin trading balance [1][6] - Based on these indicators, both the Hang Seng Index and the Shanghai Composite Index have a potential upside of 10%, targeting approximately 28,000 and 4,200 points respectively [1][7] Market Indicators - The current market sentiment is reflected in the trading volume, which reached 1.83 trillion yuan, indicating a decrease of 246 billion yuan from the previous day [5] - The number of stocks hitting the daily limit up was 87, while only 3 stocks hit the limit down, suggesting a generally positive market sentiment [4] Bull Market Analysis - Hong Hao suggests that the current bull market could last until at least November, with the potential for further gains if liquidity conditions remain favorable [6][9] - The margin trading balance has recently exceeded 2 trillion yuan, indicating a high risk appetite in the market, which typically leads the market by 1-3 months [7] Valuation and Bubble Assessment - Hong Hao rates the current level of market bubble at around 3-4 out of 10, suggesting that there is still room for growth before reaching a critical bubble stage [6] - The market capitalization to GDP ratio is currently lower than previous peaks in 2007, 2015, and 2021, which raises questions about the current valuation levels despite a more open market environment [6][9]

Core Viewpoint - The resilience of retail investors in the U.S. stock market has been notable, as they continue to buy during market downturns, contributing to the recovery of indices like the S&P 500, and reviving meme trading trends [1][3][9] Group 1: Retail Investor Behavior - Retail investors have shown a willingness to buy the dip during market declines, such as the significant drop in the S&P 500 earlier this year, which they helped rebound to record levels [1][4] - The current generation of retail investors has largely experienced a favorable market environment, growing up in a low-interest-rate era, which influences their risk tolerance and investment behavior [3][5] - Data from EPFR indicates that during the 2022 market downturn, retail investors still contributed a net inflow of $27 billion into U.S. stock mutual funds and ETFs [4] Group 2: Market Dynamics and Sentiment - The return of meme trading and the high valuations of large-cap tech stocks have raised concerns among Wall Street professionals about a potential market bubble [3][8] - Retail investors' confidence is reflected in the increasing proportion of stocks in household financial assets, which reached 36% in Q1 2023, the highest since the 1950s [6][7] - A survey by Charles Schwab revealed that approximately 80% of respondents plan to buy stocks if market volatility occurs in the coming months, indicating a strong bullish sentiment among retail investors [8]

Market Overview - US stock index futures fell ahead of the market opening on August 1, with Dow futures down 0.84%, S&P 500 futures down 0.86%, and Nasdaq futures down 0.98% [1] - Wall Street "smart money" is accelerating its exit from US stocks despite the S&P 500 nearing historical highs, with hedge funds reducing their positions at the fastest rate in a year [4] Economic Indicators - The upcoming July employment report is expected to show an addition of 110,000 jobs, a significant drop from June's 147,000, with the unemployment rate projected to rise from 4.1% to 4.2% [3] - The Federal Reserve's balance point for job growth has shifted to 80,000-100,000 jobs per month [3] Corporate Earnings - ExxonMobil reported Q2 earnings exceeding expectations with an adjusted EPS of $1.64, maintaining a $20 billion stock buyback commitment despite a nearly $20 per barrel drop in international oil prices [5] - Chevron's Q2 adjusted earnings reached $3.1 billion, with record production levels and cost control measures supporting performance [6] - Apple reported its Q3 revenue growth of 9.6%, the fastest in over three years, driven by strong iPhone sales and a recovery in the Chinese market [7] - Amazon's Q2 revenue grew 13% to $167.7 billion, but its cloud business AWS saw a growth rate of just over 17%, raising questions about the effectiveness of its AI investments [8] - Vale's Q2 net profit increased by 6% to $2.12 billion, supported by a surge in iron ore production [9] - WeRide's Q2 revenue grew 60.8%, with Robotaxi revenue reaching its highest proportion since 2021 [10] - First Solar raised its full-year guidance, expecting net sales between $4.9 billion and $5.7 billion for 2025 [11]

Market Overview - US stock index futures fell across the board, with Dow futures down 0.84%, S&P 500 futures down 0.86%, and Nasdaq futures down 0.98% [1] - Wall Street "smart money" is accelerating its exit from US stocks, with hedge funds reducing their positions at the fastest rate in a year, particularly in the technology, media, and telecommunications sectors [3] - Former JPMorgan chief strategist Marko Kolanovic warned that the US stock market is approaching a "bubble peak," driven by the excessive influence of large tech stocks [4] Economic Indicators - The upcoming US employment report is expected to show a significant drop in job additions to 110,000 in July, down from 147,000 in June, with the unemployment rate projected to rise from 4.1% to 4.2% [2] - The Federal Reserve's balance point for job additions has shifted to 80,000-100,000 per month, indicating a potential slowdown in the labor market [2] Company Performance - ExxonMobil reported Q2 earnings that exceeded expectations, with adjusted earnings per share of $1.64, and maintained a $20 billion stock buyback program despite a decline in international oil prices [4] - Chevron's Q2 earnings also surpassed expectations, with adjusted earnings of $3.1 billion and a global oil production increase to 3.4 million barrels of oil equivalent per day [5] - Apple announced its Q3 revenue growth of 9.6%, the fastest in over three years, driven by strong iPhone sales and a recovery in the Chinese market [6] - Amazon's Q2 revenue grew by 13% to $167.7 billion, but its cloud business AWS saw a growth rate of just over 17%, raising concerns about the effectiveness of its AI investments [7] - Vale's Q2 net profit increased by 6% to $2.12 billion, supported by a surge in iron ore production, although revenue declined by 11% [8] - WeRide reported a 60.8% year-over-year increase in Q2 revenue, with Robotaxi revenue reaching its highest proportion since 2021 [9] - First Solar raised its full-year guidance, reporting Q2 net sales of $1.1 billion, exceeding market expectations [10]

Group 1 - The price gap between TSMC's American Depositary Receipts (ADRs) and its stocks listed in Taipei has surged to the highest level in 16 years, raising concerns about a potential overheat in the AI boom [2][3] - In July, TSMC's ADRs traded at a 24% premium compared to its Taipei-listed stocks, up from 17% in April and 7.4% over the past decade, indicating a significant increase in demand from U.S. market participants [2] - The increase in premium is attributed to TSMC's critical role in the global AI supply chain and the limited supply of ADRs, making conversion operations difficult [2] Group 2 - Since the release of ChatGPT in 2022, TSMC's ADRs have risen over 190%, while its Taipei-listed stocks have increased by less than 140%, with foreign ownership in the latter reaching nearly 74% [3] - Market observers suggest that the widening price gap signals caution, indicating a potential bubble in the U.S. market for popular tech companies' ADRs [3]