Overnight US stocks | Three major indexes pause their rise, gold price breaks above 3700 US dollars for the first time, and the US dollar index falls below 97.

On Tuesday, the upward trend of the three major indices paused, with retail sales figures showing steady performance and minimal impact on trading. The US stock market seems to be losing momentum near historical highs. As the market awaits the expected Fed rate cut, the US dollar exchange rate falls, and the price of gold breaks through $3700 per ounce for the first time. [US Stock Market] At the close, the S&P 500 index fell by 0.13% to 6606.76 points; the Dow Jones Industrial Average fell by 0.27% to 45757.9 points; the Nasdaq Composite Index fell by 0.07% to 22333.96 points. Oracle Corporation (ORCL.US) opened high and closed up 1.4%, Tesla, Inc. (TSLA.US) rose by 2.8%, and NVIDIA Corporation (NVDA.US) fell by 1.6%. The Nasdaq Golden Dragon Index closed up 1.7%, Alibaba Group Holding Limited Sponsored ADR (BABA.US) rose by 2.6%, and NIO Inc. Sponsored ADR Class A (NIO.US) rose by 8%. [European Stocks] The German DAX30 index fell by 397.68 points, or 1.68%, to 23336.07 points; the UK's FTSE 100 index fell by 86.48 points, or 0.93%, to 9190.55 points; the French CAC40 index fell by 78.71 points, or 1.00%, to 7818.22 points; the Euro Stoxx 50 index fell by 67.15 points, or 1.23%, to 5373.25 points; the Spanish IBEX35 index fell by 230.31 points, or 1.50%, to 15158.19 points; the Italian FTSE MIB index fell by 540.72 points, or 1.26%, to 42513.00 points. [Crude Oil] Light crude oil futures for delivery in October on the New York Mercantile Exchange rose by $1.22 to close at $64.52 per barrel, up 1.93%; Brent crude oil futures for delivery in November rose by $1.03 to close at $68.47 per barrel, up 1.53%. [Forex] The US dollar index against six major currencies fell by 0.68% to close at 96.639 in the forex market. At the close of the New York forex market, 1 euro exchanged for 1.1871 US dollars, higher than the previous trading day's 1.1769 US dollars; 1 pound exchanged for 1.3662 US dollars, higher than the previous trading day's 1.3605 US dollars. 1 US dollar exchanged for 146.40 Japanese yen, lower than the previous trading day's 147.32 Japanese yen; 1 US dollar exchanged for 0.7864 Swiss francs, lower than the previous trading day's 0.7942 Swiss francs; 1 US dollar exchanged for 1.3738 Canadian dollars, lower than the previous trading day's 1.3778 Canadian dollars; 1 US dollar exchanged for 9.2199 Swedish kronor, lower than the previous trading day's 9.2722 Swedish kronor. [Cryptocurrency] Bitcoin rose by over 1.3% to $117005.28, while Ethereum fell by 0.34% to $4510.81. [Gold] The price of the nearest gold futures contract hit a historic closing high again, continuing its upward trend amid expectations of a Fed rate cut. Gold futures rose by 0.2% to $3688.90 per ounce, marking the third consecutive trading day of a record high for the nearest futures contract. Bank of America Corp stated in a report that economic data suggests the current financial environment favors gold. The bank noted, "Concerns about stagflation- usually positive for gold- remain a focus for precious metals market participants." Bank of America Corp also stated that the 2.9% Consumer Price Index (CPI) reading in August provides support for gold. The bank said, "Since 2001, with US CPI above 2% and the Fed implementing monetary easing, the price of gold has never fallen." [Macro News] US House Republicans introduce stopgap funding bill without Democratic healthcare policy demands. US House Republicans introduced a temporary spending bill aimed at avoiding a government shutdown on October 1st, challenging Democrats as the bill does not include their demands for healthcare policies. This short-term legislation would allow government agencies to continue operating until November 21st and provide new security funds for lawmakers, judiciary, and executives. This comes after conservative activist Charlie Kirk was assassinated last week. To overcome procedural hurdles, the bill would require at least seven Democratic votes in the Senate to reach the threshold of 60 votes for passage. Despite President Trump openly calling for Republican unity in support of the stopgap funding, the bill might face difficulty passing in the House with Democratic opposition, given the Republicans' slim majority. US retail data exceeds expectations, with tariff hikes pushing up prices rather than increasing sales volumes. Data shows that US retail sales grew by 0.6% in August, far surpassing expectations. Part of the reason for this increase may be tariffs pushing up prices of goods rather than an actual increase in sales volumes. Senior economist at Wells Fargo & Company, Sam Bullard, stated, "While consumer spending has some inherent resilience, the overall growth rate is slowing down. Households still have spending capacity overall, but concerns about the labor market are escalating, meaning that in the remaining time this year, the pace of consumption growth might slow down." A survey released by the New York Federal Reserve Bank on Monday shows that household spending, excluding the impact of inflation, dropped to its lowest level in nearly four and a half years in August. However, more consumers are choosing to buy electronics, appliances, furniture, purchase property and cars, as well as carry out home repairs or go on vacations. Fed "Bullhorn": Powell's attitude towards the job market this week may indicate future policy direction. In the latest article by the Fed "bullhorn" Nick Timiraos, he states, "The Fed's rate cut this week seems almost certain, and investors will be closely watching whether Powell will push forward with his recent shift in stance. Investors will be watching one key piece of information: whether Powell and his colleagues will set the total number of rate cuts for this year at three, or maintain the expectation from June (when the job market appeared more robust, with a few officials expecting two rate cuts)? In a widely watched speech last month, Powell's concern for the job market exceeded that of some colleagues for inflation at the time. The question now is: after the soft August nonfarm payrolls report, will Powell further reinforce this concern? If he does, it will confirm the market's expectation of 'continued rate cuts at future meetings,' but it may also require overcoming the concerns of some colleagues- these colleagues have doubts about the 'neutral interest rate level' and 'whether to raise interest rates to the neutral level so quickly." US industrial production nearly flat in August, trade policies and prices posing industry resistance. Data shows that US industrial production was almost unchanged in August, reflecting a slight increase in manufacturing activity, while utility output declined. Manufacturing output, which accounts for three-quarters of total industrial output, rose by 0.2% in August after a slight decline in July, better than expected. Factory output excluding automobiles rose by 0.1%. Mining and energy extraction industries grew by 0.9%, while utility output declined by 2%, the largest drop since March. In recent months, uncertainty over Trump's trade policies has suppressed capital expenditures, making it difficult for the manufacturing industry to gain a foothold. Price hikes and uneven demand have also posed challenges to the industry. The White House announced some tariff adjustments at the end of July, providing some clarity for businesses. However, the US has yet to reach trade agreements with some countries, and the Supreme Court is set to argue in early November over whether most of Trump's tariffs are legal. US builder confidence index remains unchanged in September, sales expectations rise on rate cut expectations. The US builder confidence index remained unchanged in September, but lower mortgage rates and the market's expectation of the Fed lowering the federal funds rate soon have boosted sales expectations for the coming months. Chairman of the National Association of Home Builders (NAHB), Buddy Hughes, stated that while builders are still grappling with rising construction costs, the recent drop in mortgage rates over the past month should help stimulate housing demand. NAHB Chief Economist Robert Dietz noted, "The expectation is that the Fed will lower the federal funds rate at this week's meeting, which will help lower interest rates for builders and developers. Additionally, according to Freddie Mac data, the average 30-year fixed-rate mortgage dropped by 23 basis points over the past four weeks to 6.35%. This is the lowest level since mid-October last year, and a positive signal for future housing demand." UK to announce closer collaboration with the US on cryptocurrency. According to sources, the UK and the US will announce deeper collaboration in the field of digital assets, including cryptocurrencies, bringing the two countries closer together following Trump's embrace of the industry. The sources stated that UK Chancellor of the Exchequer Rives and US Treasury Secretary Bisset discussed efforts to establish closer transatlantic cooperation in digital assets and capital markets on Tuesday. Attendees included cryptocurrency companies Coinbase, Circle, and Ripple, as well as Citigroup Inc., Bank of America Corp, and Barclays PLC Sponsored ADR. One source said the agreement was reached at the "eleventh hour." Ahead of Trump's state visit to the UK this week, the cryptocurrency industry wrote to the UK government last Thursday, urging the inclusion of digital assets and blockchain in any new agreements with the US, leading to meetings between the two parties. It is expected that any deal will specifically include stablecoins- cryptocurrencies pegged to traditional currencies. PIMCO suggests Fed pause reduction of MBS holdings to boost housing market. The Pacific Investment Management Company (PIMCO) stated on Tuesday that the Fed should consider halting the reduction of its holdings of mortgage-backed securities (MBS) to boost the US housing market. Since the start of the hiking cycle in 2022, the Fed has gradually reduced its holdings of MBS through quantitative tightening (QT), allowing the principal and interest payments from MBS to expire without reinvestment. In its report on Tuesday, PIMCO pointed out that over the past three years, the Fed's continued reduction of MBS holdings has led to abnormally wide spreads on mortgage rates (the difference between bond yields and mortgage rates) persisting. As of last Friday, the spread was approximately 230 basis points, near a historical high. This has also driven up the average rate of the most common 30-year fixed-rate mortgages in the US, which currently stands at 6.35%. PIMCO's Chief Investment Officer for non-traditional strategies Mark Sedner and others wrote that reinvesting the principal and interest payments from MBS could have an effect on lowering mortgage rates similar to rate cuts, or even better. Castle Securities strategist: US stocks may face short-term volatility, expected to finish the year strongly. Scott Rubna, head of stock and stock derivative strategies at Castle Securities, stated that the current rally driving the US stock market to new highs may experience some volatility in the coming weeks but is expected to finish the year strongly. Rubna wrote that the S&P 500 index has risen by 17% from its low point of the year, and in the short term, risks include overvaluation, common seasonal volatility in September and October, and potential selling by trend-following funds. However, these signs of potential weakness are unlikely to persist, as supporting factors driving the stock market's rally- including companies' spending in artificial intelligence and demand from retail investors- will continue to provide momentum for the market in the final months of 2025. Rubna wrote, "Stay positive about structural demand, but hedge against short-term risks, as September to October remains a fragile window." He added that investors should see short-term pullbacks as buying opportunities. [Stock News] US tech giants pledge to invest over $40 billion in the UK. Several major US tech companies announced that they will invest over $40 billion in expanding AI infrastructure in the UK, a significant positive development for the country coinciding with President Trump's state visit. Microsoft Corporation (MSFT.US) stated on Tuesday that it will invest $30 billion in AI infrastructure and existing business in the UK by 2028, marking the company's largest financial commitment in the UK. Alphabet Inc. Class C (GOOG.US) announced that it will invest around $6.8 billion in the UK over the next two years for AI, research and related engineering. Meanwhile, NVIDIA Corporation (NVDA.US), OpenAI, and the UK company Nscale are collaborating to build an artificial intelligence infrastructure in the UK to meet OpenAI's computational needs. The project, dubbed "Stargate (UK)," is expected to be located in the northeast of England, utilizing tens of thousands of NVIDIA Corporation's Grace Blackwell Ultra graphics processing units. In other investments, AI cloud computing company CoreWeave (CRWV.US) plans to invest around $2.04 billion in AI data center capacity and operations in the UK. Salesforce announced that it will reinvest $2 billion in its UK business by 2030, while BlackRock, Inc. will invest 500 million in data centers across the UK. [Major Bank Ratings] Bernstein: Initiates coverage of Apple Inc. (AAPL.US) with an Outperform rating and a target price of $290; lowers the target price of FedEx Corporation (FDX.US) from $249 to $247. UBS: Increases the year-end 2025 target price for gold to $3800 per ounce (previously $3500 per ounce) and expects it to reach nearly $3900 per ounce by mid-2026 (previously $3700 per ounce). ANZ: Raises the year-end 2025 gold target price from $3600 per ounce to $3800 per ounce and expects gold to reach nearly $4000 per ounce by June 2026. Lombard Odier: Continues to support multiple factors boosting gold, raising the 12-month target price to $3900 per ounce.