Morning News

# English Translation

Source: Wall Street CN

## Market Overview

On Friday, Federal Reserve Chair Jerome Powell’s dovish shift triggered a market rally, as he indicated that an adjustment to the policy stance could be “imminent” — sending expectations for a September interest rate cut surging sharply. The Dow Jones Industrial Average (DJIA) hit a new all-time high, with U.S. small-cap stocks leading the gains. U.S. Treasuries, gold, crude oil, and cryptocurrencies also soared in tandem, while the U.S. dollar dropped sharply.

Despite a significant rebound in the “Magnificent Seven” tech giants, they still recorded a cumulative decline for the full week. Intel closed up over 5% on Friday, following the U.S. government’s acquisition of a 10% stake in the company.

U.S. Treasury yields fell across the board, with the 2-year Treasury yield declining by 7.44 basis points. On Friday, the U.S. dollar plummeted by more than 1.3% from its intraday high, marking its largest single-day drop since April. Against the backdrop of a weak dollar, gold rose by 1%. Ethereum surged by 14%, hitting a new all-time high for the first time in four years.

Crude oil trended upward with fluctuations, and U.S. WTI crude oil closed up over 0.5%. Nearly all contracts in China’s domestic futures night session ended higher, with coking coal jumping by 6.18%.

## Key News

- Ministry of Industry and Information Technology (MIIT): Guide the construction of computing infrastructure in an orderly manner, and accelerate breakthroughs in key core technologies such as GPU chips. The scale of China’s intelligent computing power is expected to grow by over 40% this year.

- *Rules on Price Behavior of Internet Platforms (Draft for Public Comment)*: Prevent disorderly competition from distorting resource allocation and price signals. Yuyuantan Tian (a Chinese media outlet): For competition among internet platforms, the approach is not to halt it but to regulate it.

- Powell turns dovish! He emphasized risks to employment, opening the door to interest rate cuts. He noted that tariffs are expected to push up prices in a one-off manner, but their impact will take time to manifest. Powell announced an adjustment to the Federal Reserve’s monetary policy framework, phasing out the policy of tolerating high inflation and committing to keeping long-term inflation expectations anchored. The “New Fed Wire” (a source for Fed-related news): Powell sent a signal of cautious interest rate cuts, and the market should not expect interest rates to fall rapidly.

- NVIDIA will unveil “cutting-edge technologies” for humanoid robots on Monday. The company launched the Spectrum-XGS Ethernet, helping distributed data centers evolve into 1-billion-watt AI super factories. Jensen Huang (NVIDIA CEO): Aims to sell newly developed customized chips to China.

- Is the price war in large language models (LLMs) reversing? Among the latest pricing from 17 vendors, over 70% have raised their prices.

- Peter Thiel has made a substantial investment in Ethereum, betting that it will become Wall Street’s preferred blockchain for Real-World Assets (RWA).

- Donald Trump set another “two-week” timeline, which may escalate the intensity of the battlefield in the Russia-Ukraine conflict.

## Market Closing Data

### European and U.S. Stock Markets

- S&P 500: Up 1.52%, closing at 6,466.91 points

- Dow Jones Industrial Average (DJIA): Up 1.89%, closing at 45,631.74 points

- Nasdaq Composite Index: Up 1.88%, closing at 21,496.535 points

- Euro Stoxx 600 Index: Up 0.40%, closing at 561.30 points

### Chinese A-Shares

- Shanghai Composite Index: Up 1.45%, closing at 3,825.76 points

- Shenzhen Component Index: Up 2.07%, closing at 12,166.06 points

- ChiNext Index: Up 3.36%, closing at 2,682.55 points

### Bond Market

- U.S. 10-year benchmark Treasury yield: Down 7.39 basis points, closing at 4.2537%, with a cumulative decline of 6.22 basis points for the week

- U.S. 2-year Treasury yield: Down 9.54 basis points, closing at 3.6963%, with a cumulative decline of 5.42 basis points for the week

### Commodities

- WTI Crude Oil (October futures): Up 0.22%, closing at $63.66 per barrel, with a cumulative gain of 2.71% for the week

- Brent Crude Oil (October futures): Up 0.09%, closing at $67.73 per barrel, with a cumulative gain of 2.85% for the week

- COMEX Gold Futures: Up 1.05%, closing at $3,417.00 per ounce, with a cumulative gain of 1.02% for the week

# Detailed Key News

## Global Highlights

- **Ministry of Industry and Information Technology (MIIT)**: Guide the construction of computing infrastructure in an orderly manner and accelerate breakthroughs in key core technologies such as GPU chips. Xiong Jijun, Vice Minister of MIIT, stated that efforts will be made to strengthen enterprises' dominant position in innovation, promote in-depth integration of technological innovation and industrial innovation, accelerate breakthroughs in key core technologies like GPU chips, and expand the supply of basic and generic technologies. MIIT will further deepen the application of computing power in empowering industries, promote the building of a sound ecosystem for the computing power industry, and launch special initiatives to empower key sectors including education, healthcare, and energy with computing power. It will also advance the development of the "intelligent computing ecosystem", promote a batch of landmark technological products and solutions, drive the implementation of the "millisecond-level computing in metropolitan areas" special initiative, and accelerate the construction of China's Computing Power Platform. Additionally, MIIT will continue to advance the pilot program for expanding the opening-up of value-added telecommunications services such as Internet Data Centers (IDCs) in Beijing, Shanghai, Hainan, and Shenzhen, support domestic computing power enterprises in "going global", and enhance their global service capabilities.  

 The scale of China's intelligent computing power is expected to grow by over 40% this year.  

- **China's Computing Power Platform Fully Connected**: According to Shanghai Securities News, on August 23, the 2025 China Computing Power Conference, themed "Building the Foundation of Computing Networks, Leading the Future with Intelligence", opened in Datong, Shanxi Province. At the opening ceremony, China's Computing Power Platform officially completed the connection of sub-platforms in 10 provinces and municipalities, namely Shanxi, Liaoning, Shanghai, Jiangsu, Zhejiang, Shandong, Henan, Qinghai, Ningxia, and Xinjiang, realizing full integration of "platforms, entities, resources, ecosystems, and scenarios".  

- **What is UE8M0 FP8 that Ignites Domestic Computing Power Chips?** UE8M0 FP8 (MX) optimizes both model numerical formulas and hardware implementation costs to a balanced point of "compatibility & efficiency". By aligning its training/weight format with the MX standard, DeepSeek has essentially "laid the connection rails" on the domestic hardware side. As more chips adopt MXFP8 as a "first-class citizen", the cost-effectiveness of software-hardware collaboration will be truly reflected. However, "performance" depends on systems engineering. In these aspects, NVIDIA currently has a more complete end-to-end solution. Therefore, the "obvious gap" you see is essentially a platform gap, rather than a flaw in the "UE8M0/MX path". Hence, while domestic chips are gaining momentum again, we still need to remain calm!  

- ***Rules on Price Behavior of Internet Platforms (Draft for Public Comment)***: Prevent disorderly competition from distorting resource allocation and price signals. The *Rules* require platform operators not to violate Article 35 of the E-Commerce Law by imposing unreasonable restrictions or additional unreasonable conditions on the pricing behavior of in-platform merchants through measures such as restricting traffic, blocking stores, or removing products/services.  

- **Yuyuantan Tian**: For competition among internet platforms, the approach is not to halt it but to regulate it. The document took over two years to develop from drafting to the current public comment draft, during which opinions from relevant platforms were solicited multiple times. It is not a document introduced specifically in response to the "food delivery war". In fact, the document does not contain any provisions to stop subsidies; it only requires platforms to disclose the rules of subsidy promotion activities and prohibits false advertising or exaggeration of subsidy amounts.  

- **Powell Turns Dovish! Emphasizes Employment Risks, Opens Door to Rate Cuts**: Powell stated that tariffs are expected to push up prices in a one-off manner, but their impact will take time to manifest. He announced an adjustment to the Federal Reserve's monetary policy framework, phasing out the policy of tolerating high inflation and committing to keeping long-term inflation expectations anchored.  

 Powell noted that stable labor market indicators allow the Fed to consider policy adjustments cautiously, and changes in the baseline outlook and risk balance may require the Fed to adjust its policy stance. The labor market has achieved a "unique balance" due to a significant slowdown in both supply and demand, which suggests increasing downside risks to employment. In the short term, inflation risks are skewed upward while employment risks are skewed downward, creating a challenging situation. The monetary policy framework has been adjusted to remove references to seeking to achieve an average 2% inflation target over time and using deviations from full employment as a basis for decision-making.  

 The new framework eliminates language about the low-interest-rate environment, returns to a flexible inflation targeting system, and abolishes the "compensatory" inflation strategy. The revised Statement on Longer-Run Goals and Monetary Policy Strategy emphasizes that a "balanced approach" will be adopted to address employment and inflation goals, clarifying that "long-term inflation is mainly determined by monetary policy" while noting that the level of full employment "cannot be directly measured" and changes over time. It also points out that employment may sometimes exceed the real-time estimated level of full employment without necessarily posing risks to price stability.  

- **The "New Fed Wire"**: Powell Sends Signal of Cautious Rate Cuts, No Expectation for Rapid Rate Declines. Nick Timiraos, a reporter for The Wall Street Journal, said that while Powell sent a signal of a September rate cut, he implied that the market should not expect "aggressive easing like a downhill sprint". He is walking a tightrope between an increasingly weak "unique" labor market and persistent inflationary pressures driven by tariffs. This complex economic situation and divisions within the Fed mean that future rate cuts will be restrained and gradual, aiming to guide the economy toward a challenging soft landing.  

- **NVIDIA to Unveil "Cutting-Edge Technologies" for Humanoid Robots on Monday**: The preheated product is a "new brain" designed for robots. Jensen Huang stated at the opening ceremony of the 2025 China International Supply Chain Promotion Expo in July this year that the next wave of AI will be robots, "which possess reasoning and execution capabilities and can understand the physical world".  

- **NVIDIA Launches Spectrum-XGS Ethernet to Help Distributed Data Centers Evolve into 1-Billion-Watt AI Super Factories**: Spectrum-XGS Ethernet breaks the above-mentioned limitations by introducing scale-across infrastructure. Scale-across has become the "third pillar" of AI computing following scale-up and scale-out. It can extend the extreme performance and scale of Spectrum-X Ethernet to multiple distributed data centers, integrating them into intelligent giant AI super factories with a capacity of 1 billion watts.  

- **Jensen Huang**: Aims to Sell New Customized Chips to China. Earlier, sources revealed that NVIDIA is developing an AI chip named B30A for the Chinese market, with performance exceeding the previous H20 chip. In response, Jensen Huang said, "We are providing a new product to China, a successor to the H20, for AI data centers. But we cannot make the decision; of course, it depends on the U.S. government."  

- **Is the Price War in Large Language Models (LLMs) Reversing? Over 70% of 17 Vendors Raise Prices in Latest Pricing**: Over the past year, API prices of companies such as OpenAI, Anthropic, and Google have remained largely unchanged or even increased slightly. Meanwhile, subscription plans have become increasingly expensive, with top-tier models mostly locked in high-price tiers of $200/month or above, and xAI has even launched a $300/month subscription plan. DeepSeek's price increase is just a microcosm of a larger industry trend: currently, the downward trend in LLM prices is gradually slowing down, and top-tier AI services are no longer falling indefinitely; instead, they are showing signs of stabilizing and slightly rebounding.  

- **Peter Thiel Makes Substantial Investment in Ethereum, Betting on It as Wall Street's Preferred Blockchain for Real-World Assets (RWA)**: Billionaire investor Peter Thiel believes that if Ethereum can become an alternative channel for clearing and settling U.S. dollars, stocks, and other assets outside the traditional financial system, its native token will benefit significantly from increased network activity. Wall Street giants have begun to lay out plans on Ethereum: BlackRock and Franklin Templeton have launched tokenized money market funds on the Ethereum network, and Apollo Global Management has also issued a diversified credit securitization fund via Ethereum.  

- **Trump Sets Another "Two-Week" Timeline, May Escalate Russia-Ukraine Conflict Intensity**: According to CCTV News, U.S. President Trump recently stated that if the leaders of Russia and Ukraine do not hold direct talks within two weeks, he will make a "very important decision", which could be "large-scale sanctions or tariffs".  

## Domestic Macroeconomics

- **State Council Executive Meeting**: Listens to Report on Implementation of Large-Scale Equipment Upgrading and Consumer Goods Trade-In Policies, Studies Measures to Unlock Sports Consumption Potential. Presided over by Li Qiang, the State Council Executive Meeting listened to a report on the implementation of large-scale equipment upgrading and consumer goods trade-in policies, studied opinions on unlocking sports consumption potential to further promote the high-quality development of the sports industry, and arranged for special rectification work on the safety of marine fishery production.  

- **U.S.-EU Trade Agreement Framework Contains Multiple Phrases "Indirectly Referring to China"? Hong Kong Media: May Bring "New Rifts" to EU-China Relations**: According to Global Network, although the U.S.-EU joint statement does not explicitly mention China, many phrases are believed to have "obvious implications". The statement says the EU plans to purchase at least $40 billion worth of U.S. AI chips and align with the U.S. on technological security standards to jointly prevent technology from flowing to "relevant destinations". *South China Morning Post* believes this statement mainly targets China.  

- **CITIC Securities**: This Round of Market Rally Is Not Driven by Retail Investors; Core Drivers Are Industrial Trends and Corporate Earnings. CITIC Securities believes that retail investors are not the main initiators or drivers of the current market rally; from the start to the acceleration phase, the core clues have centered on industrial trends and corporate earnings. As products issued between 2020 and 2021 generally enter the break-even zone, the market will experience a transition between old and new capital. The continuation of the future market will require new allocation clues, rather than relying on "abundant liquidity". In terms of allocation, it is recommended to continue focusing on resources, innovative drugs, games, and military industries, start paying attention to the chemical industry, gradually increase allocation to "anti-involution + overseas expansion" sectors, and the consumer electronics sector in September also deserves attention.  

- **PPI, RMB Exchange Rate, and Reassessment of Chinese Assets**: China Merchants Securities believes that as a manufacturing country, China's PPI largely determines the profitability of domestic enterprises. The "anti-involution" trend has led the market to focus on the prospect of PPI turning positive in advance and triggered a shift in asset style: the barbell strategy has shifted to inflation and domestic demand strategies; pro-cyclical assets have obtained a certainty premium, while bond-like assets have changed from a "reservoir" to a "cash machine" over the past three years. September may be an observation window for RMB exchange rate appreciation. Against the backdrop of a weakening U.S. dollar, if the RMB exchange rate returns to the 6-yuan range against the U.S. dollar, Chinese assets may see a comprehensive reassessment.  

- **The Next Step After "New Highs"**: Guojin Securities Strategy believes that looking ahead, the realization of earnings improvement expectations will be the main driver of the market in the next phase. The launch of the interest rate cut cycle will also accelerate the growth of manufacturing investment, further strengthening the characteristic that manufacturing outperforms the service industry, and physical assets will face favorable conditions.  

- **Is There a Bubble in A-Shares?** The VIX Index, a "gold standard" for market sentiment, is near the warning line but not out of control. More importantly, the intrinsic value estimation model shows that the CSI 300 Index is still undervalued by approximately 11%. This round of gains is supported by solid fundamentals that have been overlooked by the market, such as eased foreign exchange pressure and improved core CPI, rather than an emotional bubble.  

- **Shanghai Composite Index Regains 3,800 Points for the First Time in 10 Years; Goldman Sachs**: Hedge Funds Net Buy Chinese Stocks at Fastest Pace in 7 Weeks.  

## Domestic Companies/Industries

- **Express Delivery Fees Rise; E-Commerce Customer Unit Prices in Guangdong and Zhejiang Take the Lead in Adjustment**.  

- **"Capacity Clearance" Rumored Document Confirmed; Closed-Door Meeting on Lithium Iron Phosphate Industry Held in Shenzhen**.  

## Overseas Macroeconomics

- **After U.S. Bureau of Labor Statistics' "Disbelief", Wall Street Relies More on "Private Surveys"**: Data such as ADP Employment and Challenger Layoffs Become Increasingly Important for the Market. For a long time, Wall Street has used employment statistics such as Challenger Layoffs or ADP as supplementary information sources, but now more people say these reports will become more important. Inflation reports from the Institute for Supply Management (ISM) or manufacturing and services data compiled by S&P Global will also receive more attention. Wall Street strategists stated that they will more strictly verify official data by comparing it with private sources.  

- **Goldman Sachs Traders**: Now, Everything Depends on August Nonfarm Payrolls. Goldman Sachs traders believe that if nonfarm payroll growth announced in September is less than 100,000, it will help confirm a September rate cut. Goldman Sachs pointed out that multiple factors may lead to negative revisions in future employment data, and the current average 35,000 monthly employment growth over three months is worrying. Whether in a scenario of economic slowdown or normalization, the Fed is likely to end the rate cut cycle in the first half of 2026.  

- **Jackson Hole Retreat**: Powell's dovish shift at the Jackson Hole Symposium came unexpectedly, and some of his remarks contradicted those made at the July FOMC press conference. In his review and outlook of the economy, Powell's view on the labor market underwent a 180-degree turn, and he began to explicitly express concerns about downside risks to employment. The side effects of a relatively loose monetary policy environment and a dovish policy framework are more uncontrollable inflation dynamics in the future. After consecutive interest rate cuts, the U.S. economy, which may accelerate again, will face a higher inflation center — more "stagnation" this year and more "inflation" next year.  

- **Liu Gang (CICC)**: Do Not Misinterpret the Impact of Powell's Speech — It Is Not a "Recessionary Rate Cut" but a "Preventive Rate Cut"! Liu Gang from CICC believes that if interest rate cuts can quickly boost demand, then naturally, there will be no need for many rate cuts, and the market's trading focus will quickly shift from the denominator logic of easing brought by rate cuts to the numerator logic of fundamental improvement. Therefore, expectations that this will boost emerging markets will be disappointed: during the 2024 Fed cycle, our market declined; during the 2019 rate cut cycle, our market fluctuated.  

- **Tech Stocks Issue Warning: AI Narrative Begins to Waver, Risks Spreading to "Invisible" Corners**: The correction of tech stocks is sounding an alarm for the market. Risks are quietly spreading from the "top-heavy" public market supported by a few giants to the private credit sector that provides huge funds for AI infrastructure. Once leading tech stocks stall, the stability of the entire market will face severe challenges.  

- **Courting Trump to Promote Negotiations: Canada to Lift Multiple Retaliatory Tariffs on U.S. from September, Auto Steel and Aluminum Tariffs Remain Unchanged**: The tariff removal affects more than $20 billion worth of goods such as orange juice, wine, clothing, and motorcycles. Chrystia Freeland said Canada will lift tariffs on goods covered by the USMCA in synchronization with the U.S., re-establishing free trade for most goods between the two countries; it will accelerate negotiations in key industries such as automobiles, steel, and aluminum, focusing on strategic areas and future renegotiations of the agreement. When asked if Canada's strategy toward the U.S. has softened, Freeland argued that Canada has signed the best trade agreement with the U.S. Media reported that the U.S. Secretary of Commerce had previously pressured Canada, stating that retaliatory tariffs are an obstacle to comprehensive negotiations.  

- **Indian Foreign Minister**: India-U.S. Trade Negotiations Continue, Will Adhere to Bottom Lines. Faced with the U.S. threat of imposing further high tariffs on India, Indian Foreign Minister Subrahmanyam Jaishankar stated on the 23rd that India-U.S. trade negotiations are still ongoing, but there are certain bottom lines that must be adhered to and defended in the negotiations. India is committed to protecting the interests of its farmers and small businesses and will make decisions based on national interests. According to multiple media reports, the U.S. trade negotiation delegation's scheduled visit to New Delhi from August 25 to 29 has been canceled. Reuters analyzed that this further dashes hopes of possible U.S. tariff reductions or delays on Indian goods.  

## Overseas Companies

- **How to Identify Software Companies in the AI Era? The Hottest Indicator in the U.S. Market: NRR**: Net Revenue Retention (NRR) has become a key touchstone for identifying AI software companies. An NRR exceeding 100% not only reflects existing customers' increased purchases and product stickiness but also serves as strong evidence of AI value realization. However, analysts warn to be vigilant about differences in calculation methods behind the numbers, as this indicator lacks a unified standard. Companies like Figma inflate NRR data by screening customer groups, adjusting time cycles, etc., leading to distorted horizontal comparisons.  

- **"Spent No Money": Trump Says Government Has Acquired 10% Stake in Intel, U.S. Industrial Policy May Undergo Major Shift**: Intel reached a historic shareholding agreement with the Trump administration. The U.S. government will make an equity investment of $8.9 billion in the company, subscribing to 433.3 million Intel shares. Trump said, "We acquired these shares without spending any money, and they are currently worth approximately $11 billion." Intel's stock price rose by about 5.5% on Friday.  

# Industries/Concepts

1. **Consumer Electronics**: Q3 is the traditional peak season for the consumer electronics sector. Major terminal manufacturers will release new products such as AI-enabled smartphones and AR glasses intensively, pushing the sector into a mass production peak, and the operating rate of the industrial chain will rise rapidly. Guosheng Securities pointed out that the implementation of edge-side AI is expected to accelerate the replacement cycle of terminals like smartphones, and it is optimistic about the recovery resilience of this sector.

2. **STAR 50 Index**: A research report by Western Securities reviewed the market performance since April 9, 2025, and found that the STAR 50 Index still has room for catch-up growth. Within the electronics sector, the core segments of semiconductor manufacturing/equipment have lagged in terms of growth and have the potential for catch-up. Comprehensively, the overlapping stocks between STAR 50 constituent stocks and semiconductor manufacturing/equipment stocks have significant catch-up growth potential.

3. **Optical Interconnection**: NVIDIA announced the launch of NVIDIA® Spectrum-XGS Ethernet. This scale-across technology can integrate multiple distributed data centers into a 1-billion-watt AI super factory. GF Securities believes that with the surge in AI demand, interconnection between data centers has become an industrial trend. It is recommended to continuously pay attention to leading optical module companies that have laid out in the field of optical interconnection.

4. **Securities IT**: Guosheng Securities pointed out that recently, the market transaction activity and the number of new A-share accounts opened have increased significantly. The balance of margin trading has exceeded the 2 trillion yuan mark, hitting a 10-year high. Market risk appetite has risen. The internet finance sector has both the potential for performance release in a bull market and the attribute of the Real-World Assets (RWA) theme, making its allocation value prominent.

# Preview of Today's Key News

- China Evergrande Group will have its shares delisted starting at 9:00 a.m. on August 25.

- U.S. new home sales data for July.

- South Korean President Lee Jae-myung visits the United States and holds a summit with U.S. President Donald Trump.

- Speech by Lorie Logan, President of the Federal Reserve Bank of Dallas.

- Earnings report of PDD Holdings.

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