Overnight US stocks | "Powell's Dove Day" Dow Jones and Ethereum hit historic highs, Chinese concept stocks generally rise

On Friday, the three major indexes surged. Federal Reserve Chairman Powell stated that the continuously "changing" economic risks provided the Fed with more reasons to lower interest rates. These remarks indicate that Powell has moved towards the "dovish" camp within the Federal Open Market Committee responsible for setting interest rates, signaling that he may support a 25 basis point rate cut at the Fed's next meeting in September. Although Powell acknowledged the visible impact of the government's trade wars on consumer prices, he hinted that this impact is unlikely to continue and may be just a one-time shock that the central bank can overlook. He stated, "Given that the labor market is not particularly tight and faces increasing downside risks, the prospect of continued inflationary pressures seems unlikely." He also added, "Inflation faces upside risks while employment faces downside risks, presenting a challenging situation." Traders increased their bets on a rate cut by the Fed next month. Traders now perceive the likelihood of a rate cut by the Fed in September to be close to 90%, compared to around 75% before Powell's speech. US StocksBy the close of the market, the Dow Jones Industrial Average rose by 846.24 points, an increase of 1.89%, to 45631.74 points; the Nasdaq rose by 396.22 points, an increase of 1.88%, to 21496.53 points; the S&P 500 index rose by 96.74 points, an increase of 1.52%, to 6466.91 points. During the day, the Dow hit a high of 45787.84 points, setting another intra-day high. Alphabet Inc. Class C (GOOG.US) closed up 3.17%, Intel Corporation (INTC.US) rose by 5.53%. The Nasdaq Golden Dragon Index rose by 2.73%, MNSO (MNSO.US) surged by 20.25%, NIO Inc. Sponsored ADR Class A (NIO.US) rose by 14.60%, XPeng, Inc. ADR Sponsored Class A (XPEV.US) rose by 4.46%. European StocksThe German DAX30 index rose by 79.42 points, an increase of 0.33%, to 24370.74 points; the UK's FTSE 100 index rose by 12.57 points, an increase of 0.14%, to 9321.77 points; the French CAC40 index rose by 31.40 points, an increase of 0.40%, to 7969.69 points; the Euro Stoxx 50 index rose by 27.19 points, an increase of 0.50%, to 5489.35 points; the Spanish IBEX35 index rose by 108.70 points, an increase of 0.71%, to 15395.30 points; the Italian FTSE MIB index rose by 294.56 points, an increase of 0.68%, to 43308.00 points. Asian StocksThe Nikkei 225 index edged up, the South Korean KOSPI index rose by 0.86%, while the Indonesia Composite Index fell by 0.4%. Crude OilThe price of light crude oil futures for October delivery on the New York Mercantile Exchange rose by 14 cents to close at $63.66 per barrel, a rise of 0.22%; the price of Brent crude oil futures for October delivery rose by 6 cents to close at $67.73 per barrel, an increase of 0.09%. Foreign ExchangeThe US Dollar Index, a measure of the dollar against six major currencies, fell by 0.92% to close at 97.716 in the currency market's closing session. At the close of the New York foreign exchange market, 1 euro exchanged for $1.1722, higher than the previous trading day's $1.1610; 1 pound exchanged for $1.3526, higher than the previous trading day's $1.3419. 1 US dollar exchanged for 146.87 yen, lower than the previous trading day's 148.35 yen; 1 US dollar exchanged for 0.8011 Swiss francs, lower than the previous trading day's 0.8089 Swiss francs; 1 US dollar exchanged for 1.3825 Canadian dollars, lower than the previous trading day's 1.3899 Canadian dollars; 1 US dollar exchanged for 9.4971 Swedish kronor, lower than the previous trading day's 9.6200 Swedish kronor. CryptocurrencyEthereum surged by over 14%, breaking its historical high set in early November 2021, accumulating a more than 250% increase since its low point on April 9, with a total market value of nearly $590 billion. MetalsSpot gold rose by 0.99% to $3371.86 per ounce, completely maintaining the momentum brought by Federal Reserve Chairman Powell's speech, with a weekly increase of 1.07% - fluctuating within the $3310-3358 range before Powell's speech. COMEX gold futures rose by 1.05% to $3417.00 per ounce, with a weekly increase of 1.02%. The Philadelphia Gold and Silver Index rose by 1.81% to 239.23 points, setting a new closing high for the second consecutive trading day, with a weekly increase of 3.37%. BondsThe yield on the 10-year benchmark US Treasury bond fell by 7.39 basis points to 4.2537%, as of 10:00 pm Beijing time. During Federal Reserve Chairman Powell's speech at the Jackson Hole global central bank annual meeting, the yield plummeted from above 4.3% to near 4.24%, and then continued to fluctuate at lower levels, with a weekly decline of 6.22 basis points, showing an overall M-shaped trend trading within the 4.3511% -4.2402% range. The yield on the two-year US bond fell by 9.54 basis points to 3.6963%, with Powell's dovish signal causing a drop from around 3.78% to below 3.7%, followed by continued low-level fluctuations, with a weekly decrease of 5.42 basis points, trading within the 3.8040% -3.6732% range overall. Macro News Powell announces the latest adjustments to the monetary policy framework focusing on more flexible strategies in response to employment and inflation. Federal Reserve Chairman Powell announced the latest adjustments to the Fed's monetary policy framework, a strategic document that guides long-term decision-making. This includes clarifying a shift in 2020, stating that officials will not raise interest rates preemptively to prevent inflation just because the unemployment rate is too low. He stated that policymakers still agree that raising rates should not solely be based on estimates of the long-term unemployment rate. However, the 2020 revision "never intended to permanently restrict the ability to raise rates preemptively when the labor market is strong." In the latest adjustment, officials removed the wording "decisions will be based on an assessment of employment below the maximum level" and replaced it with "employment may sometimes rise above real-time estimates of the maximum level of employment, but this does not necessarily pose a risk to price stability". This shows a decreased tolerance for overheating labor markets while maintaining the Fed's policy flexibility. "If the labor market is tight or other factors pose risks to price stability, taking preemptive action may be necessary," Powell said. Bundesbank President Nagel: Threshold for ECB lowering interest rates again is high. Bundesbank board member Joachim Nagel stated that for borrowing costs to be lowered again, there needs to be a significant change in economic prospects. In an interview, the Bundesbank President stated that the euro area is in a state of "some balance," with inflation and interest rates both at 2%. After eight 25 basis point rate cuts, he believes the ECB does not have much reason to take further action. "I think the threshold is high," Nagel, who attended the annual Federal Reserve symposium in Jackson Hole, Wyoming, said, "So, to persuade me to change monetary policy, there needs to be very compelling reasons." Fitch Ratings: Confirms US "AA+" rating, outlook stable. Fitch has confirmed the US rating as "AA+" with a stable outlook. Fitch stated that the US sovereign rating benefits from its large economic size, high per capita income, vibrant business environment, and the special financing flexibility brought by the US dollar as a major global reserve currency. However, high fiscal deficits, a heavy interest burden, and a high and rising government debt level limit this rating. The US has not taken meaningful action to address its large fiscal deficits, rising debt burden, and the imminent expenditure growth related to an aging population. Fitch predicts that with income substantially increasing, the government deficit as a percentage of GDP will decrease from 7.7% in 2024 to 6.9% in 2025, then rise to 7.8% of GDP in 2026 and 7.9% in 2027. Canada to lift retaliatory tariffs on multiple US products, but maintain steel and aluminum tariffs. Canada is set to lift retaliatory tariffs on a range of American goods that comply with the current USMCA agreement to ease tensions with the White House. Sources revealed that Canadian Prime Minister Trudeau is expected to announce this decision after a cabinet meeting on Friday. This means that American-made consumer goods that comply with the USMCA's relevant terms will no longer face a 25% tariff when imported into Canada. However, Canada is expected to retain the 25% import tax on American steel and aluminum products, as well as tariffs on US automobiles. This marks a significant policy shift for Canada, as it was one of the few countries to swiftly retaliate against protectionist measures taken by the US government, which had caused displeasure among Trump and his Commerce Secretary Lighthizer. Stock News The US government now holds a 10% stake in Intel Corporation (INTC.US). US Commerce Secretary Lighthizer announced that the federal government has acquired a 10% stake in the troubled chip giant Intel Corporation, which is the latest step by the Trump administration to strengthen control over American companies. Intel Corporation stated in a press release that the US government purchased 4.333 billion shares of common stock at a price of $20.47 per share, with a total investment of about $8.9 billion, corresponding to a 10% stake. Intel Corporation pointed out that this price was lower than the market price at the time. Reportedly, $5.7 billion of the funding came from the Chip and Science Act, approved but yet to be disbursed grant funds, while an additional $3.2 billion came from a government project for developing secure chips. US President Trump posted on the social platform Truth Social, stating, "The US government obtained these shares at no cost, and they are now worth about $11 billion. This is a great deal for America, and for Intel Corporation." Additionally, the US government also received a warrant, allowing it to purchase an additional 5% stake in Intel Corporation if it is no longer a controlling shareholder of its chip manufacturing business. Apple Inc. (AAPL.US) is reportedly considering using Alphabet Inc. Class C's Gemini model to support the new version of Siri. According to reports, Apple Inc. is in preliminary discussions with Alphabet Inc. Class C to use Gemini to power an improved version of Siri, marking a critical step for Apple Inc. toward outsourcing more artificial intelligence technology. Sources revealed that Apple Inc. recently contacted Alphabet Inc. Class C to explore building a customized artificial intelligence model that will serve as the basis for the new Siri next year. The sources stated that Alphabet Inc. Class C had begun training a model that could run on Apple Inc. servers. Earlier this year, Apple Inc. also explored partnerships with Anthropic or OpenAI to evaluate if Claude or ChatGPT could become the "new brain" of Siri. Currently, Apple Inc. needs a few weeks to decide if it will continue using an in-house model for Siri or turn to a partner, and Apple Inc. has not yet determined who this partner would be.