Report Core View - Copper's fundamentals are neutral with smelting enterprises reducing production and scrap copper policies being relaxed, and the manufacturing PMI in August rising to 49.4% [2] - The basis shows a neutral situation with the spot price at 79355 and a basis of -55, indicating a discount to the futures [2] - Copper inventories on August 29 increased by 950 to 158900 tons, and SHFE copper inventories decreased by 1950 tons from last week to 79748 tons, considered neutral [2] - The copper price closed above the 20-day moving average with the 20-day moving average moving upward, showing a bullish signal [2] - The main positions are net long and increasing, also a bullish indication [2] - Currently, copper prices are expected to move in a range as inventory is rising, geopolitical disturbances persist, and the market awaits consumption guidance in the September peak season, with no prominent long - short contradictions [2] Market Situation Analysis - In terms of recent factors, domestic policy easing is a positive factor, while the escalation of the trade war is a negative one [3] - The supply - demand balance shows a slight surplus in 2024 and a tight balance in 2025 [20] - The Chinese annual supply - demand balance table reveals production, import, export, and consumption data from 2018 - 2024, with a supply - demand balance of 110,000 tons in 2024 [22] Market Conditions - The bonded area inventory has rebounded from a low level [14] - Processing fees have declined [16]

Group 1 - The article highlights the increasing strategic coordination among China, North Korea, and Russia in Northeast Asia, particularly in response to the strengthened alliance between the US, South Korea, and Japan [1] - The US Secretary of Commerce's comments on rare earth elements reflect a misunderstanding of the historical context, as the US was once a leader in rare earth production but chose to outsource this industry to China [6][7] - China's advancements in rare earth processing technology have led to it controlling 90% of the global rare earth refining capacity and 67% of related patents, showcasing a significant shift in the industry [9] Group 2 - The US Vice President's recent softening stance on tariffs against China indicates a recognition of the economic impact of these tariffs on American consumers and businesses, as many everyday products are sourced from China [4] - The reliance of the US military on rare earth elements, with a report indicating only 18 months of inventory remaining, underscores the strategic vulnerability of the US in high-tech and military competitiveness [9] - The article critiques the US narrative around rare earth elements, suggesting that the complaints from US officials are a reflection of their inability to change the current dependency on China, rather than an accurate portrayal of the situation [9]

Core Viewpoint - The article discusses the recent rise in inflation pressures in the U.S. as of July, alongside a significant increase in consumer spending, indicating a complex economic landscape ahead of the Federal Reserve's September meeting [3]. Inflation Pressure - The Personal Consumption Expenditures (PCE) price index rose by 0.2% month-on-month in July, a slowdown of 0.1 percentage points from the previous month, with a year-on-year increase of 2.6%, remaining stable compared to June [4]. - The core PCE price index, excluding volatile food and energy prices, increased by 0.3% month-on-month, with a year-on-year growth accelerating to 2.9%, the highest level since February [4]. Consumer Spending - Consumer spending, which accounts for over two-thirds of economic activity, was revised up to 0.4% in June and accelerated to 0.5% in July, marking the highest growth since March [5]. - The increase in spending was largely driven by durable goods purchases, which rose by 0.8%, particularly in automobiles, household furniture, and sporting goods [5]. Labor Market and Employment - Despite a low unemployment rate supporting consumption and wage growth, employers are hesitant to increase headcount due to rising operational costs from tariffs [5]. - Average monthly job growth over the past three months was reported at 35,000, significantly lower than the 123,000 in the same period last year [5]. Policy Outlook - The July PCE data is one of three key reports ahead of the Federal Reserve's September meeting, alongside the August non-farm payroll report and the Consumer Price Index (CPI) [7]. - Many economists on Wall Street expect inflation to rise further due to increasing business costs and reduced inventory, with retailers and automakers warning that tariffs are raising their costs, which may be passed on to consumers [7]. Federal Reserve Consensus - There is a growing consensus within the Federal Reserve towards a potential rate cut in September, although significant divisions remain regarding inflation concerns and labor market weaknesses [8]. - The probability of a 25 basis point rate cut in September stands at 84%, consistent with the PCE data release [7]. Consumer Sentiment - The proportion of consumers finding it "hard to get a job" rose to the highest level in four and a half years as of August, indicating growing concerns about the labor market [9]. - Despite concerns about inflation spiraling, the current data suggests a potential for a rate cut in September, although uncertainties remain due to strong consumer and core inflation rates exceeding the Federal Reserve's target [9].

Group 1 - The July Personal Consumption Expenditures (PCE) price index increased by 0.2% month-on-month, with a year-on-year growth of 2.6%, remaining stable compared to June [2] - The core PCE price index, excluding food and energy, rose by 0.3% month-on-month and accelerated to a year-on-year increase of 2.9%, the highest level since February [2] - Consumer spending accelerated to a growth rate of 0.5% in July, marking the highest increase since March, largely driven by durable goods purchases [2][3] Group 2 - The low unemployment rate supports steady growth in consumption and wages, with July wages increasing by 0.6% month-on-month [3] - Despite rising operational costs due to tariffs, employers are hesitant to increase hiring, with average monthly job growth at 35,000 over the past three months, significantly lower than the 123,000 in the same period last year [3] - The PCE data is one of three key reports ahead of the Federal Reserve's September meeting, alongside the August non-farm payroll report and the Consumer Price Index (CPI) [4] Group 3 - Many Wall Street economists expect inflation to rise further due to increasing business costs and reduced inventory, with retailers and automakers warning that tariffs are raising their costs [4] - The manufacturing PMI in August expanded at the fastest rate in over three years, contributing to ongoing inflationary pressures, with the sales price index reaching a three-year high [4] - The probability of a 25 basis point rate cut in September is at 84%, with a growing consensus within the Federal Reserve, although concerns about inflation remain [5]

Core Insights - The core PCE price index in the U.S. rose to a year-on-year increase of 2.9% in July, indicating a slight uptick in inflationary pressures [1][2] - Consumer spending saw its largest increase in four months, accelerating to 0.5% in July, primarily driven by durable goods purchases [2][3] - The labor market remains weak, with average monthly job growth significantly lower than previous years, which may influence future monetary policy decisions [3][5] Inflation Trends - The PCE price index increased by 0.2% month-on-month in July, with a year-on-year growth of 2.6%, remaining stable compared to June [2] - Core PCE, excluding volatile food and energy prices, rose by 0.3% month-on-month, with a year-on-year increase of 2.9%, the highest since February [2] - Service costs rose by 0.3% month-on-month and 3.4% year-on-year, indicating persistent inflation in the service sector, which is less affected by tariffs [2][4] Economic Outlook - The upcoming Federal Reserve meeting in September will consider the July PCE data alongside the non-farm payroll and CPI reports [4] - Rising tariffs are expected to increase business costs, potentially leading to higher consumer prices, as indicated by recent warnings from retailers and automakers [4] - The probability of a 25 basis point rate cut in September is currently at 84%, reflecting a growing consensus within the Federal Reserve, despite concerns about inflation [5][6]

Market Overview - Major indices closed lower on Friday, but all recorded gains for the month, with the Dow Jones up 3.21%, Nasdaq up 1.58%, and S&P 500 up 1.91% for August [1] - The U.S. Court of Appeals ruled that most of the global tariff policies implemented by former President Trump were illegal, stating that he exceeded his authority [1] Economic Indicators - The core Personal Consumption Expenditures (PCE) price index, excluding food and energy, rose to 2.9% year-over-year, an increase of 0.1 percentage points from June [1] - The overall PCE index showed a year-over-year rate of 2.6% with a monthly increase of 0.2%, both meeting consensus expectations [1] - The University of Michigan's consumer confidence index fell to 58.2 in August, down from 61.7 in July, indicating growing pessimism about the economy [5] Stock Market Performance - On Friday, the Dow Jones fell by 92.02 points (0.20%) to 45,544.88, the Nasdaq dropped by 249.61 points (1.15%) to 21,455.55, and the S&P 500 decreased by 41.60 points (0.64%) to 6,460.26 [2] - Nvidia (NVDA) fell over 3.3%, while Apple (AAPL) and Amazon (AMZN) also experienced declines [2] Commodity and Currency Markets - Crude oil prices fell, with light crude oil futures down $0.59 to $64.01 per barrel (0.91% drop) and Brent crude down $0.50 to $68.12 per barrel (0.73% drop) [3] - The U.S. dollar index decreased by 0.04% to 97.771, with mixed performance against major currencies [3] Cryptocurrency and Precious Metals - Bitcoin dropped by 3.75% to $108,347.3, while Ethereum fell over 3.3% to $4,359.47 [4] - COMEX gold futures rose by 1.19% to $3,515.50 per ounce, approaching historical highs [4] Corporate News - Citadel Securities reported a 8.4% decline in net trading revenue for Q2, totaling $2.39 billion, but achieved a record total revenue of $5.77 billion for the first half of the year [6] - Morgan Stanley is seeking a review of new capital requirements set by the Federal Reserve, which will take effect on October 1 [7] Regulatory Developments - The European Union is expected to impose a moderate antitrust fine on Google for alleged anti-competitive practices in its advertising technology business [8]

Trade Policy - The US President stated that all tariffs remain in effect [1] - The US President believes that revoking tariffs would be a complete disaster [1] - The US Treasury Secretary warned that removing tariffs would create a "dangerous diplomatic embarrassment" [1]

美国上诉法院裁定特朗普政府征收的全球关税多数不合法，法院认为他在征收这些关税时超越了自己的权限。华盛顿的一个法官小组周五维持了国际贸易法院先前的一项裁决，认为特朗普错误地援引了紧急法律来实施关税。不过，上诉法院同意在10月14日前不执行该裁决，以便给特朗普政府时间向最高法院上诉。 https://t.co/9SnRPgVNng ...

Core Viewpoint - The current trade conflict and tariffs are expected to have a more significant negative impact on Caterpillar's business than previously anticipated, leading to a decline in stock price [1][2]. Financial Impact - Caterpillar now expects a tariff-related hit to its fundamentals totaling between $1.5 billion and $1.8 billion for the year, which is several hundreds of millions more than the original forecast of $1.5 billion [3]. - For the current third quarter, the company estimates the tariff impact to be between $500 million and $600 million [4]. Analyst Reactions - Following the disclosure of the revised impact, two analysts lowered their price targets for Caterpillar. Baird's Mircea Dobre adjusted his target to $495 per share from $500 while maintaining an outperform rating [5]. - Oppenheimer's Noah Kaye reduced his price target to $480 per share from $493 but also kept an outperform rating [5].

Group 1 - Consumer confidence in the U.S. significantly declined in August, reaching a three-month low, indicating ongoing concerns related to tariffs and inflation [1] - The final consumer confidence index for August dropped to 58.2, down from 61.7 in July and below the preliminary value of 58.6 [1] - Consumers expect prices to rise at an annual rate of 4.8% over the next year, an increase from the previous month's expectation of 4.5% [1] Group 2 - Approximately 63% of respondents anticipate an increase in the unemployment rate over the next year, a figure that is higher than both the previous month and the same period last year [1] - The willingness to purchase big-ticket items and automobiles has significantly worsened, with consumers citing high prices and tax/tariff factors as major concerns [1] - The U.S. government reported that consumer spending in July saw the largest month-over-month increase in four months, supported by income growth [2] Group 3 - The core PCE price index, excluding food and energy, rose to 2.9% year-over-year in July, marking the highest level since February [2] - The Michigan University index reflecting future expectations fell to 55.9, a three-month low, and the current conditions index also decreased to 61.7 [2]