Preview of US Stock Market | Three major stock index futures continued to decline, with the hawkish stance of the Federal Reserve suppressing expectations of interest rate cuts, and concerns about the AI bubble heating up.

1. Before the U.S. stock market opened on November 14 (Friday), the futures of the three major U.S. stock indexes fell together. As of the time of writing, the Dow Jones Industrial Average futures fell by 0.58%, the S&P 500 index futures fell by 1.00%, and the Nasdaq futures fell by 1.49%. 2. As of the time of writing, the German DAX index fell by 1.64%, the French CAC40 index fell by 1.52%, the UK FTSE 100 index fell by 1.31%, and the European Stoxx 50 index fell by 1.72%. 3. As of the time of writing, WTI crude oil rose by 1.53% to $59.59 per barrel. Brent crude oil rose by 1.30% to $63.83 per barrel. Market News The hawks at the Federal Reserve exacerbate internal divisions, reducing the expectations of a rate cut in December to below 50%. Due to concerns about inflation and some officials believing that the labor market remains strong, more decision-makers are showing hesitation towards further loosening monetary policy, including some former staunch supporters. The latest development is that Boston Fed President Collins and San Francisco Fed President Daly - two officials who had previously voted in favor of rate cuts this year - have issued their most cautious signals yet. Collins bluntly stated that the "threshold for further policy easing is relatively high" in the near term, while Daly stated that it is premature to draw conclusions about the December decision and she maintains an "open mind". The upcoming release of Beijing Vastdata Technology, along with recent hawkish statements, has pushed market bets on a December rate cut back to below 50%. Wall Street sounding stronger warnings! Experts: The AI bubble will eventually lead to losses, credit "cockroaches" are everywhere! Mohamed El-Erian, Chief Economic Advisor at Allianz, has issued a stern warning about the evolving global economy and the AI boom. He points out that while the underlying system remains intact, investors should be prepared for significant personal losses in the AI sector. He also expects a large number of "credit incidents." El-Erian states that he collaborated with Nobel laureate Michael Spence to evaluate the prosperity of artificial intelligence and concluded that the market is experiencing a "rational bubble": while the total value created by AI is huge, it is reasonable for investors to adopt risk investment strategies and "over-invest" due to high returns, but there is also a dark side behind the bubble: tears and losses. More and more professional investors are backing away, and Bitcoin is plunging into a bear market! ETF withdrawals nearly $900 million, marking the second largest outflow in history. As the risk aversion sentiment that has swept through global financial markets accelerates in recent times, high-valued assets such as US tech stocks and Bitcoin seem to be falling into a downward spiral. Investors have withdrawn nearly $900 million from Bitcoin ETF funds, further pushing Bitcoin below the $100,000 threshold, with the downturn seemingly showing a trend of continuing deepening. According to CoinGecko data, the global cryptocurrency market has remained under pressure since a massive $19 billion liquidation on October 10, erasing more than $1 trillion from the total market capitalization of all cryptocurrencies. According to CoinGlass data, the trend towards liquidation continues, with over $1 billion in leveraged cryptocurrency positions being force-liquidated in the past 24 hours. Meanwhile, Bitcoin ETFs in the US stock market saw net outflows of approximately $870 million on Thursday, marking the second largest single-day redemption since its introduction in early 2024. Market Disagreements: Hedge funds continue to sell stocks, while retail investors support the bull market. According to the latest client fund flow data from Bank of America Corp, hedge funds and other institutional clients are the largest net sellers of individual stocks and exchange-traded funds this year, having sold over $67 billion in value through 2025. In the first week of November, concerns over overvaluation intensified, leading hedge funds and other large investors to make the largest tech stock net sales in two years. Retail investors, on the other hand, have been repeatedly entering the market, helping maintain the upward trend of large-cap tech stocks and more speculative sectors in the market. However, this pattern seems to be evolving as signs of fatigue appear in retail investors after the market's continued upward trend. Power advantage becomes crucial! Goldman Sachs Group, Inc. is bullish on China surpassing the US in the AI data center race. Goldman Sachs Group, Inc. stated that China's large-scale power capacity construction will give it an advantage over the US in expanding data centers to power artificial intelligence. Since facing a series of power shortages in 2021 and 2022, China has been aggressively constructing power facilities, with renewable energy, coal-fired power plants, and nuclear power units leading the world in construction speed. By 2030, China may have around 400 gigawatts of backup power capacity, three times the expected demand for global data centers, providing ample room for the continuous expansion of data centers. Although China currently has approximately a quarter of the global data center capacity, it could soon catch up with the US, which has a leading share of 44%. Trump plans significant reduction in food tariffs, multiple trade agreements in Latin America help lower prices. US President Trump is planning a significant reduction in tariffs to address high food prices and promote a series of new trade agreements - including framework agreements with Argentina, Guatemala, El Salvador, and Ecuador - aimed at responding to concerns about the cost of goods among voters. This move comes after the Democratic Party won in multiple key state and local elections last week, with candidates emphasizing concerns about the cost of living. The trade agreements with Latin American countries announced on Thursday will lower tariffs and barriers on daily food items like beef, bananas, and coffee beans, aiming to alleviate the food price pressures that have plagued American consumers for years. Additionally, Trump and senior government officials have hinted at broader tariff exemptions, which could significantly reduce rates on popular food items. Trump promised to "lower coffee tariffs" earlier this week in an interview, while Treasury Secretary Scott Benet hinted at preferential treatment for fruit imports. Individual Stock News Supply shortages worsen, Samsung (SSNLF.US) reportedly raises memory chip prices by 30%-60%. According to sources, Samsung Electronics will raise server chip prices by 30% to 60% this month, higher than September levels. Samsung had previously delayed the official pricing announcement of October supply contracts, with pricing details usually announced monthly. This price surge may further increase the cost pressure on large enterprises building data infrastructure. Additionally, the rise in memory chip prices may also elevate the costs of other products such as smartphones and computers. However, for Samsung, which lags behind competitors in advanced artificial intelligence chip sectors, this supply shortage presents an opportunity to improve profitability. The company has stronger pricing power in the memory chip market compared to competitors like SK Hynix and Micron (MU.US). NVIDIA Corporation (NVDA.US) quarterly report to be revealed next week! Top tech investors bullish: at least two more prosperous years. As the most anticipated report of this earnings season, the NVIDIA Corporation quarterly report will be released next week. A top tech investor believes that Wall Street's bullish sentiment for the chip giant is not strong enough before the financial report is released. Gene Munster, a tech venture capital investor and founder of Loup Ventures, remains optimistic about NVIDIA Corporation, despite concerns that its performance may show slowing growth and a cooling in AI trading. Munster believes that NVIDIA Corporation's prosperity will last for at least another two years. "Blackwell and Rubin's revenue targets for the end of 2026 show that revenue is likely to increase by more than 10%. I expect the revenue growth rate for 2026 to be raised from the current 39% to 45%." After Huang Renxun's visit to Taiwan "for production capacity," Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR (TSM.US) may urgently add a production expansion plan? or may raise capital expenditure for 2026. According to a new research report released by Morgan Stanley, Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR may plan to increase its 3-nanometer wafer capacity by an additional 20,000 pieces per month beyond previous expectations. The firm initially projected Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR's 3-nanometer capacity for 2026 to be around 140,000 to 150,000 pieces per month, but the latest information suggests this number could be raised to 160,000 to 170,000 pieces per month. If this expansion plan is implemented, it will have a direct impact on Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR's capital expenditure. The additional capacity is estimated to require an additional $5 billion to $7 billion in capital expenditures, potentially pushing Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR's total capital expenditure for 2026 from the current expectation of about $43 billion to a range of $48 billion to $50 billion. This potential increase in spending is seen as a positive catalyst for the global semiconductor industry. Major Shift for Musk! Tesla, Inc. (TSLA.US) rumored to be developing support for Apple Inc.'s (AAPL.US) CarPlay feature. According to sources, Tesla, Inc. is developing support for Apple Inc.'s CarPlay in its vehicles, which is one of the most requested features by Tesla vehicle owners. Sources also revealed that Tesla, Inc. has started internal testing of this feature. According to a 2024 study by McKinsey, about one-third of buyers say that if a vehicle does not support CarPlay or an equivalent system for Android, it would be an "unacceptable factor" in their purchasing decision. Sources added that Tesla, Inc. has discussed the possibility of launching CarPlay in the coming months, although the plan has not been finalized and the release date could be delayed. Merck & Co., Inc. (MRK.US) announces $9.2 billion acquisition of Cidara (CDTX.US), with pre-market stock price doubling. Merck & Co., Inc. announced that it has reached a definitive agreement to acquire Cidara Therapeutics through its subsidiary for $221.50 per share in cash, with a total transaction value of approximately $9.2 billion. Cidara surged over 100% in pre-market trading. Important Economic Data and Events Forecast 22:20 Beijing time: FOMC voter and Atlanta Fed President Bostic speech. 23:05 Beijing time: FOMC voter and Kansas City Fed President Schmidt speech on economic outlook and monetary policy.