Zhongjin: The U.S. dollar and U.S. stocks are not simply linked. Despite the weak U.S. dollar, U.S. stocks may still rise against the trend.

The China Securities Regulatory Commission released a research report stating that the current highly convergent and grand narrative-based "de-dollarization" consensus also faces two practical problems: expectations are overly crowded, and the grand narrative cannot provide specific guidance for short-term operations. The firm believes that the relationship between US stocks and the US dollar is not one-way and linear. A weak US dollar does not necessarily result in a drop in US stocks, and a drop in US stocks does not necessarily weaken the US dollar. Historically, if the US can benefit more from a weak US dollar, even if the US dollar depreciates significantly, US stocks can continue to strengthen. In addition, sometimes a weak US dollar reflects more capital outflows from the bond market rather than the stock market. The US dollar is influenced by growth differentials, monetary policy, and safe haven demand; US stocks more so reflect their own fundamentals.