Preview of US Stock Market | The three major stock index futures fell together, oil prices rose more than 6%, gold fell below $4700, and Micron Technology plunged after its earnings.

Pre-Market Market Trends 1. Before the market opened on Thursday, March 19th, the futures of the three major US stock market indices fell together. As of press time, Dow futures fell by 0.20%, S&P 500 futures fell by 0.21%, and Nasdaq futures fell by 0.32%. 2. As of press time, the German DAX index fell by 2.58%, the UK FTSE 100 index fell by 2.10%, the French CAC 40 index fell by 1.81%, and the European Stoxx 50 index fell by 2.17%. 3. As of press time, WTI crude oil rose by 1.28% to $96.68 per barrel. Brent crude oil rose by 6.56% to $114.42 per barrel. Market News Gold and silver dropped together. As tensions in the Middle East have pushed oil prices higher again and with the hawkish stance of the Federal Reserve, gold and silver prices fell together. As of press time, spot gold fell by 2.6% to $4694 per ounce, and spot silver fell by over 6% to $70.68 per ounce. Remaining on the sidelines could lead to policy errors? "Minority economists" blast the Federal Reserve for misjudgment again. Marko Bjegovic, a senior macroeconomic economist at Arkomina Research, stated after the Federal Reserve announced its decision to remain on hold with interest rates that the Fed missed a crucial rate-cutting window amid rising unemployment, making a policy error. Bjegovic outlined his concerns regarding the Fed policymakers maintaining current interest rates despite increasing signs of economic weakness in the U.S. and globally. He believes the Fed's decision to stay put is a policy mistake, as his policy function and mainstream market expectations are completely misaligned: he focuses more on deteriorating labor markets and "real interest rates still being too tight" rather than prioritizing inflation risks. In his view, the negative employment growth and a rapidly rising unemployment rate in the U.S. are sufficient indicators of recession risks, and if the central bank continues to delay rate cuts due to fears of oil prices and stagnating inflation, it will only worsen the labor market. Oil price surge "no cause for panic"? JP Morgan confronts the Federal Reserve: Don't try to trick the markets, inflation will ultimately impact employment. Bob Michele, the global head of fixed income at JPMorgan Asset Management, expressed skepticism towards the Federal Reserve's attempt to reassure the markets amid the surging oil prices and escalating GEO Group Inc political risks. He disagreed with the notion that there is "no need to panic," stating that "inflation will ultimately be substantially affected, and ultimately the labor market will also be unable to escape." Michele noted that whether Federal Reserve Chairman Powell will remain in office after his term ends in May remains a focus of the market's attention. "My personal view is that he will stay on until after the midterm elections," even if Powell does not continue as chairman, "his staying on could bring market stability." Morgan Stanley follows in the footsteps of Goldman Sachs Group, Inc. and Barclays, predicting a delay in the Federal Reserve's first rate cut of the year until September. Morgan Stanley has joined Goldman Sachs Group, Inc. and Barclays in pushing back their expectations for the next rate cut by the Federal Reserve from June to September. The Wall Street investment bank currently predicts that the Fed will cut rates by 25 basis points in September and December, revising their previous forecast of rate cuts in June and September. Morgan Stanley strategists stated in a report, "The cautious attitude of the Federal Reserve means that rate cuts will be delayed. The main risk to our view is that rate cuts will arrive later, or may not come at all," "However, on the other hand, the second surge in oil prices may lead to economic activity and labor market weakening, prompting rate cuts." Technical analysts warn: U.S. stocks are on the verge of a reversal! Once the critical level is breached, they could fall by another 10%. The S&P 500 index fell by 1.4% on Wednesday, marking its worst performance on a Federal Reserve decision day since 2024, breaking a two-day rally to close at 6624.70 points, slightly above its 6615.70 points 200-day moving average. Jonathan Krinsky, Managing Director and Chief Market Technician at BTIG, stated that this is the third time the S&P 500 index has tested the 6600 level since October. If the stock market falls on Thursday, the S&P 500 index could break this key support level. He said, "We are not confident that it can hold the support level." He added that this technical pattern suggests there is a significant possibility that the S&P 500 index will fall all the way back to 6000 points, meaning there is a further 10% downside. Middle East war triggers global economic growth concerns, copper prices hit a new low since December last year. Due to the escalating conflict in the Middle East, which has pushed up energy prices and increased the risk of damage to the global economy, copper prices have fallen to their lowest point since December last year. Copper prices started the year strong, reaching a historical high at the end of January, but have dropped by over 8% this month. As of press time, LME copper futures fell by 2.5% to $12091 per tonne. Wu Kunjin, Chief of Base Metals Research at Minmetals Futures Co., stated, "This concerns worries about the economy and inflation. The longer oil prices stay at high levels, the greater the impact on inflation. An increase in oil prices does not necessarily mean that interest rates will rise, but this possibility does exist." Stock-Specific News Surge in AI demand drives performance surge, with Micron Technology, Inc. (MU.US) reporting a nearly three-fold increase in revenue year-over-year in Q2, high capital expenditure raising market concerns. Micron delivered significantly better-than-expected results, but an intense capital expenditure plan has made investors cautious. The financial report shows that for the second quarter of fiscal year 2026 ending on February 26th, Micron's revenue surged nearly three times to $23.86 billion from $8.05 billion in the same period last year, much higher than the expected $20.07 billion; adjusted earnings per share were $12.20, significantly exceeding the expected $9.31. Net profit soared to $13.8 billion, up from just $1.58 billion in the same period last year, showing a significant improvement in profitability. Gross margin also rose sharply to 74.4%, doubling from 36.8% in the same period last year. Looking ahead, Micron provided a more optimistic performance guidance. The company expects third-quarter revenue to reach around $33.5 billion, with a year-over-year growth rate of over 200%, and adjusted earnings per share of about $19.15, far exceeding market expectations of revenue around $24.3 billion and earnings per share of around $12. However, the surge in demand also comes with a significant increase in capital expenditure. The company expects capital expenditures for the current fiscal year to exceed $25 billion, higher than the previously expected $22.4 billion, and anticipates further substantial increases in expenditures by fiscal year 2027, particularly in additional investments related to wafer fab construction exceeding $10 billion. As of press time, Micron fell nearly 6% in pre-market trading on Thursday. Apple Inc. (AAPL.US) saw a 23% year-on-year increase in smartphone sales in China in early 2026, contrary to the Android camp, which was forced to raise prices due to rising memory costs. Apple Inc. reported a strong 23% growth in smartphone sales in China in the first nine weeks of 2026, resisting overall market downturn pressures. Data released by market research firm Counterpoint shows that smartphone sales in China fell by 4% year-on-year between January and early March this year. Despite the government's introduction of consumer subsidy policies early in the year, weak consumer demand could not be effectively stimulated. Apple Inc.'s sales growth mainly benefited from discounts on e-commerce platforms and policy support for its entry-level iPhone 17 models eligible for national subsidies. The report highlighted that Apple Inc.'s strict control over the supply chain makes it more cost-absorbent compared to competitors, allowing it to effectively resist the impact of rising memory chip prices. The market expects Apple Inc. to maintain its current pricing strategy while competitors are forced to raise prices, potentially further expanding Apple Inc.'s market share. Musk: Tesla, Inc. (TSLA.US) is expected to start production of the AI6 chip in December. Musk stated on Thursday that it is possible that the production of its next-generation AI6 chip will be underway in December, meaning the chip design has been finalized and sent to the factory for production. Musk had previously indicated that Samsung Electronics would be responsible for producing the AI6 chip, which is likely to be used in autonomous vehicles produced at Tesla, Inc.'s new factory in Taylor, Texas, and humanoid robots by Siasun Robot & Automation. Prior to this, the South Korean company had reached a $16.5 billion deal with Tesla, Inc. to supply AI chips. A senior Samsung executive stated on Wednesday that the company plans to start production of Tesla, Inc. chips based on its advanced 2-nanometer process in the second half of 2027. Important Economic Data and Events Ahead 20:30 Beijing time - Initial jobless claims in the U.S. up to the week ending March 14th 20:30 Beijing time - Philly Fed manufacturing index for March in the U.S. 22:00 Beijing time - The Federal Reserve will convene a meeting to discuss the revision of capital requirements for the largest and most active banks internationally, as well as related requirements for other large banks, and make adjustments to additional capital requirements for U.S. globally systemically important banks Earnings Forecast Friday morning: FedEx Corporation (FDX.US) Before the market opens on Friday: XPeng, Inc. ADR Sponsored Class A (XPEV.US)