Written by: Trend Research

On Monday, U.S. stocks showed extreme divergence, with the Dow Jones up 0.26% at 53,417.16 points for two consecutive rises, the S&P 500 down 0.28% at 7,652.82 points, the Nasdaq down 0.76% at 25,869.14 points, and the Philadelphia Semiconductor Index down nearly 4%. U.S. Treasury Secretary Yellen used nearly a trillion dollars from the TGA account to repurchase long-term bonds and announced new sanctions against Iran. Long-end interest rates fell, but funds flocked into gold and Bitcoin as safe havens, with the Nasdaq leading the decline. Nvidia informed clients of a price increase of over 15% next year, with its financial report to be released after the market on Wednesday. tonight attention will be on the U.S. Conference Board Consumer Confidence Index for August.

Yellen's Dual Approach: Nearly a Trillion to Buy Bonds to Suppress Rates, Sanctions on Iran Increase Geopolitical Risk

The biggest macro variable on Monday came from U.S. Treasury Secretary Yellen. He announced the use of nearly a trillion dollars from the TGA account to repurchase long-term bonds, while also unveiling multiple economic sanction measures against Iran.

The direction of these two policies is opposite. Buying bonds to suppress long-end rates is favorable for the stock market, but imposing sanctions on Iran raises geopolitical risk premiums and dampens risk appetite. The market ultimately chose the latter. Funds flowed out of AI hardware and technology sectors and into gold and Bitcoin.

The yield on the 10-year U.S. Treasury bond fell about 3 basis points to 4.70%, the 30-year yield fell about 2 basis points to 5.25%, and the 2-year yield fell about 1 basis point to 4.22%. Although long-end rates have fallen, technology stocks did not benefit from this. The Nasdaq dropped 0.76%, and the Philadelphia Semiconductor Index fell nearly 4%, indicating the traditional logic that lower interest rates are beneficial for technology failed on Monday, as geopolitical risk weighted more than interest rates.

WTI crude oil fell 2.35% to $85.01 per barrel, and Brent crude fell 2.35% to $92.17 per barrel. The decline in oil prices was mainly suppressed by concerns over demand prospects, rather than a reduction in geopolitical risks.

Nvidia Informs Customers of a Price Increase of Over 15% Next Year, Plans to Invest in Perplexity

Macro uncertainty has suppressed technology stocks, and Nvidia was one of the affected stocks that day. On Monday, two pieces of news emerged: the company has informed large-scale clients like Microsoft and Google that AI server prices will increase by over 15% next year; simultaneously, Nvidia plans to invest in AI search company Perplexity.

The price increase news followed previous logic, as the surge in storage chip costs has driven up server prices, with Nvidia passing costs to cloud providers. However, Monday's market showed that the response to the price increase news was not positive. The Philadelphia Semiconductor Index fell nearly 4%, indicating that concerns about the AI hardware supply chain have gone beyond the scope of "whether the price increase can be sustained," with more focus on trading geopolitical risk and macro uncertainty.

Nvidia will release its financial report after the market closes on Wednesday. A price increase is a positive signal, but the market is more concerned about Blackwell shipments, guidance for data center revenues, and whether AI capital expenditures can continue to support orders.

Samsung's Buyback Falls Short of Expectations, Changes in Storage Sector Logic

Samsung Electronics' shareholder return plan fell short of market expectations, raising analysts' concerns about the future capital expenditures in the storage chip sector. On Monday, Samsung dropped 8.7% in the Korean market.

Previously, SK Hynix and Samsung successively announced large-scale shareholder return plans, leading the market to price the storage sector with a dual support of "price increase + buyback." Samsung's buyback falling short of expectations disrupted this narrative, and the prospects for capital expenditure in the storage sector became a concern for the market once again. The Philadelphia Semiconductor Index fell nearly 4%, with the shortfalls of storage leaders being a significant drag.

U.S.-Canada Tariff Conflict Escalates, Trump Announces Auto and Steel Tariffs Raised to 50%

Trump announced that starting next year, tariffs on Canadian cars, parts, and steel would be increased to 50%. This marks a further escalation of the tariff conflict following the breakdown of U.S.-Canada negotiations last week.

Automobiles, parts, and steel are core components of the North American supply chain; raising tariffs directly to 50% from current levels will have a substantial impact on Canadian manufacturing and cross-border supply chains. Previously, the market assessed the trade friction as "there is still room for negotiation," but Trump’s latest statement indicates that tariff escalation has become an established policy direction.

Spot Gold Reaches Over $4650, Bitcoin Approaches $80,000

Funds have chosen the safe haven direction in Yellen's policy mix. Spot gold rose 1.05% to $4,651.24 per ounce, with an intraday high of $4,681, hitting a near three-month high. Bitcoin rose 1.59% to $78,966, briefly nearing $80,000 for the first time since mid-May. The U.S. dollar index rose 0.20% to 98.93.

The logic behind gold and Bitcoin rising simultaneously differs. Gold trades on geopolitical risks and fiscal concerns, while Bitcoin trades more on liquidity expectations and the repair of risk appetite. However, both have one common point: funds did not flow into AI hardware but went toward “dollar credit substitute” assets.

Today’s Focus

U.S. Conference Board Consumer Confidence Index for August. PMI has already indicated strong signals in the services sector, and whether consumer confidence can synchronously verify consumption resilience will impact the market's confidence in a soft landing for the economy.

Expectations for Nvidia’s financial report continue to evolve. The two pieces of news on Monday added new variables to the report. The market will continue to contend until the report is released, with any signals regarding Blackwell shipments, data center revenue guidance, or capital expenditures potentially triggering volatility.

The direction of the market on Tuesday will unfold amid the contest of consumer confidence data and expectations for Nvidia's financial report.