Dongwu Securities: In the short term, the US stock market is mainly fluctuating at high levels. In the medium to long term, the main trend is still upwards.

Dong Wu Securities research report stated that in the short term, the high-level US stock market will undergo multiple "stress tests", and we believe that the US stock market will mainly fluctuate. First, the market is currently caught between hopes for a slowdown in global demand and expectations of interest rate cuts, highly sensitive to macroeconomic data, and any slowdown in data will magnify fluctuations in the US stock market. Second, the calendar effect. Over the past thirty years, August and September have on average been the worst performing months for the S&P 500 index; third, in August, central banks around the world will hold the Jackson Hole meeting, and the US stock market may start pricing in the possibility of a hawkish policy bias in advance. Looking at the medium to long term, the US stock market will return to a trajectory dominated by economic fundamentals and corporate profit resilience, with the main trend still upward. First, the macroeconomic fundamentals are slowing down, but not to the point of recession, and the US economy has not yet experienced a catastrophic deterioration. On the one hand, household wage income remains stable, providing support for consumption and nominal growth; on the other hand, the wealth effect in the US also safeguards the country's economic growth. Second, the continuous surge in tokens and the accelerating implementation of AI, with the medium to long term trends determined, performance realization becoming the main theme, so the AI narrative in the US stock market can continue in the medium to long term; third, on the policy front, US interest rate cuts, tax cuts, and other policies can provide a support for the downward economy, serving as a hedge.