Preview of US Stock Market | The three major stock index futures were mixed, with chip and optical communication stocks seeing a widespread rise before the market opened. U.S. stocks are entering "Retail Earnings Week."

Pre-market Market Trends 1. As of August 17 (Monday) pre-market, the three major U.S. stock index futures show mixed results. At the time of publication, Dow futures are down 0.16%, S&P 500 futures are up 0.12%, and Nasdaq futures are up 0.52%. 2. As of publication, Germany's DAX index is up 0.10%, the UKs FTSE 100 index is up 0.21%, Frances CAC40 index is down 0.13%, and the Europe Stoxx 50 index is up 0.30%. 3. As of publication, WTI crude oil is up 0.59%, at $81.95 per barrel. Brent crude oil is up 0.80%, at $89.23 per barrel. Market News U.S. stocks enter "Retail Earnings Week": Walmart Inc. (WMT.US) leads the charge, as the market bets the Federal Reserve will hold steady in September with over 70% probability. After a week filled with inflation worries and questions about the Fed's next steps, investors are looking forward to a relatively calm five-day period. Earnings reports from major supermarkets and other key retailers, along with a wealth of manufacturing data, will be the focal point for the market. Earnings reports from major supermarkets will be concentrated on Thursday, with Walmart Inc. (WMT.US), Ross Stores, Inc. (ROST.US), and Deere & Company (DE.US) announcing quarterly results, followed by BJ's Wholesale Club Holdings, Inc. (BJ.US) releasing its earnings on Friday. On the economic data front, manufacturing indicators will be paramount. The U.S. will release industrial production and manufacturing output data on Tuesday, with S&P Global, Inc.'s U.S. manufacturing PMI reading to be published on Friday. The calendar also includes new housing starts data, which is expected to show a significant decline on Tuesday, as well as the release of the minutes from the Federal Reserve's last meeting on Wednesday. Shipping through the Strait of Hormuz is nearly at a standstill, with Iran announcing it is drafting a maritime route plan with Oman. As the U.S.-Iran 60-day ceasefire agreement is set to expire on Monday, shipping through the Strait of Hormuz has nearly halted over the weekend, and no formal negotiations have begun between the two parties, with no signs of a new agreement emerging. Shipping data agency Kpler reports that only five cargo vessels passed through this global energy transport choke point on Saturday, and no vessels were recorded crossing on Sunday; in comparison, there were 31 vessels that crossed the strait the previous weekend. According to recent reports, on August 17 local time, Iranian Foreign Ministry spokesman Baghaei stated that Iran is seriously drafting a maritime route plan with Oman. Baghaei noted that the prolonged drafting process is due to the complicated security situation caused by U.S. and Israeli actions, as well as the involvement of numerous parties and disruptive factors. Despite ongoing negotiations for the route with Oman, Iran has repeatedly made it clear that the reopening of this strategic waterway depends on whether the U.S. can fulfill the obligations set forth in the memorandum. Goldman Sachs Group, Inc.: The market's bets on Federal Reserve policy remain too hawkish, with "very little chance" of a rate hike in September. Goldman Sachs Chief Economist Jan Hatzius wrote in a client report that due to weak U.S. retail sales data, disappointing employment figures, and slowing inflation data, the chance of a rate hike at the Fed's September meeting is "very small." Hatzius stated, "According to our fundamental economic forecast, inflation data is more likely to improve over time than to worsen again. We still believe the market is pricing the federal funds rate too hawkish." Data shows traders have delayed expectations for the Feds next rate hike of 25 basis points to January next year, whereas just a week earlier they fully expected the Fed to raise rates in December. Goldman Sachs indicated that while market hawkish sentiment has weakened, there is still room for reductions in rate hike expectations. Additionally, Goldman Sachs noted that due to improving inflation, decreased rate hike premiums, and negative fiscal budget news, the U.S. Treasury yield curve may further steepen. AI Bull Market Enters "Reality Check Era"! Morgan Stanley and JP Morgan both target S&P 8000, as semiconductors and the South Korean stock market rebound powerfully validate the "profit upward trend". Since August, amid a significant rebound in technology stocks led by the semiconductor sector and broadly AI computing infrastructure themes, the recent extreme volatility in global stock markets is rapidly diminishing. Major financial giants on Wall StreetMorgan Stanley and JP Morganhave recently jointly issued research reports indicating that the first driving force pushing the S&P 500 upwards is switching from valuation expansion to profit revisions + AI commercialization realization. Last week, JP Morgan raised its end-2026 target from 7800 to 8000 points and adjusted the EPS profit trajectory for this year and next. Morgan Stanley similarly raised its 2026 target to 8000 points and its 12-month target to 8300 points, clearly stating that the adjustments are primarily profit-driven rather than valuation-driven. Currently, at least seven Wall Street institutions expect that the S&P 500 will reach 8000 points by the end of 2026. U.S. Consumer Market Signals Red? CEOs from multiple giants warn: Low-income groups' "wallets are running dry". For many years, American consumers have been the cornerstone of economic resilience, managing to support their household budgets despite high inflation, rising borrowing costs, and ongoing increases in daily expenses. However, recently, several leaders from major companies have raised alarms that this consumer momentum may be nearing a critical point. For instance, Chris Kempczinski, CEO of McDonald's Corporation, pointed out that consumers are under pressure, noting an "escalation of anxiety," while Mark Bitzer, CEO of appliance giant Whirlpool, painted a grim picture of sharply declining demand for large appliances. Several macro data points also confirm that financial stress on American households is increasing. As of the first quarter of 2026, U.S. credit card outstanding balances reached $1.25 trillion, while auto loan balances climbed to $1.69 trillion. Meanwhile, the willingness of households to save continues to drop, with the personal savings rate falling to a mere 2.7% in June. Individual Stock News Chip and optical communication stocks generally rose pre-market. On Monday pre-market, as of publication, in the chip sector, SanDisk (SNDK.US) rose nearly 5%, SK Hynix (SKHY.US) rose nearly 4%, Micron Technology, Inc. (MU.US) and Western Digital Corporation (WDC.US) rose over 3%, while Seagate Technology Holdings PLC (STX.US) rose over 2%; Intel Corporation (INTC.US) and AMD (AMD.US) rose over 1%. In the optical communication sector, Astera Labs (ALAB.US) rose over 5%, Coherent (COHR.US), Lumentum (LITE.US), Corning Inc (GLW.US), Marvell Technology, Inc. (MRVL.US), and Credo Technology (CRDO.US) all rose over 2%, while Nokia Oyj Sponsored ADR (NOK.US) rose over 1%. Refuting the AI Bubble with Diverse Financing! From a century bond to the debut of Australian dollar bonds, Alphabet Inc. Class C (GOOGL.US) supports its AI ambitions with global financing. As U.S. tech companies flock to the corporate credit market to finance increasingly expansive investments in AI computing infrastructure, Alphabet Inc. Class C is further broadening its international debt financing channels. It is reported that Alphabet Inc. Class C has hired several large commercial banks to prepare for a potential inaugural issuance of Australian dollar-denominated corporate bonds. The company may issue bonds with four different maturities, with the longest period reaching 20 years. Notably, this year, Alphabet Inc. Class C has broadened its financing to form a genuine global capital market network: in February, it issued 5.5 billion (approximately $7.53 billion) and CHF 3.055 billion (approximately $3.98 billion) in bonds, which even included a rare 100-year bond in the tech industry since 1997. Soon after, the company issued 9 billion (approximately $10.6 billion), CAD 8.5 billion (approximately $6.2 billion), and a record-setting 576.5 billion (approximately $3.6 billion) bond for foreign enterprisestotaling at least $31.9 billion in non-dollar-denominated debt financing outside the U.S. since 2026. A "comeback" or a "money pit"? Intel Corporation (INTC.US) aims to re-enter the storage market, betting on a new architecture to establish itself in the AI era. On August 11 local time, Chen Liwu revealed in a podcast that a new storage architecture, previously considered a "commoditized business," has now become a strategically significant area and is one of his focused projects. He also indicated that the storage industry is at a critical point of innovation and hinted that Intel Corporation is exploring options to stack storage above CPUs. For investors, Intel Corporations signal of a possible return to the storage market is directly related to its re-focusing of its business portfolio and rebuilding trust in its role within the AI infrastructure domain. Reinserting storage into its product lineup could help Intel Corporation achieve a more complete platform for emerging AI workloads, rather than solely providing CPUs and wafer fabrication capacity. However, this also amplifies an existing risk in the current investment logic. Intel Corporations complex organizational structure, high operating and capital expenditures have consistently been central concerns in the market. Re-entering the capital-intensive storage chip sector will also test how much Intel Corporation can streamline its business. Important Economic Data and Event Forecast At 20:30 Beijing time, U.S. August New York Fed Manufacturing Index Earnings Forecast Tuesday morning: BHP Group Ltd Sponsored American Depositary Receipt Repr 2 Shs (BHP.US), Fabrinet (FN.US) Tuesday pre-market: Home Depot, Inc. (HD.US), Baidu Inc Sponsored ADR Class A (BIDU.US), iQIYI, Inc. Sponsored ADR Class A (IQ.US), Pony.ai (PONY.US), VNET Group, Inc. Sponsored ADR (VNET.US), uCloudlink Group, Inc. Sponsored ADR Class A (UCL.US)