The first trading week of August 2026 saw global capital markets undergo the baptism of a super data week. The US July nonfarm payrolls report, released before the market opened last Friday, became the catalyst that ignited the US stock market. The data significantly missed market expectations, instantly fueling frenzied bets among investors that the Federal Reserve will accelerate rate cuts this year. Under the anticipated combination of a "weak economy + loose monetary policy," the three major US stock indices staged a classic "bad news is good news" rally during the session. For cross-border investors, this not only reconfirms a turning point in macro liquidity but also marks a critical juncture for adjusting US stock positions in the second half of the year.
Nonfarm Payrolls "Shock": Unemployment Rate Unexpectedly Rises, Rate Cut Expectations Reshape Valuation Anchor
According to the latest data released by the US Department of Labor, only 112,000 nonfarm jobs were added in July, significantly below the market expectation of 175,000, and the previous figure was revised down to 144,000. A more sensitive indicator—the unemployment rate—unexpectedly climbed from 4.1% to 4.3%, hitting a three-year high. Wage growth slowed to 3.8% year-on-year, indicating that the US labor market is genuinely cooling.
Following the data release, the CME FedWatch Tool showed that traders' probability expectation for a 50-basis-point rate cut at the September FOMC meeting surged from under 30% before the data to nearly 70%. Some aggressive voices even suggest that if subsequent inflation and employment data continue to weaken, the Fed could cut rates up to four times in 2026. The 10-year US Treasury yield plummeted nearly 15 basis points in a single day, breaking below the 4.0% threshold. The decline in the risk-free rate directly boosted the valuation center of US stocks, especially in the highly interest-rate-sensitive tech growth sector, which became the primary target for capital inflows.
Real-Time Quotes for Three Major US Indices: Nasdaq Leads, S&P 500 Hits New Intraday High
Stimulated by the nonfarm payroll data, the three major US stock indices showed a strong, one-sided upward trend during Friday's session. At the close, the Nasdaq Composite surged 2.15% to close above 18,950 points, leading the three indices; the S&P 500 rose 1.42%, closing at 5,668 points after touching an intraday record high of 5,680 points; the Dow Jones Industrial Average also rose 0.85%, with blue-chip stocks seeing simultaneous capital replenishment.
Judging from the performance of US stocks, the market exhibited typical "easing trade" characteristics. Long-duration asset sectors such as semiconductors, AI application software, and biotechnology led the market rally. The Philadelphia Semiconductor Index (SOX) surged nearly 3.5% in a single day. Meanwhile, interest-rate-sensitive sectors like US real estate and utilities also recorded significant capital inflows. Conversely, traditional defensive sectors such as consumer staples and healthcare relatively lagged due to capital rotating into higher-risk assets.
Tech Giants' Earnings Relay: Divergent Performance Intensifies Intra-Sector Rotation
Beyond the macro data catalyst, the current period marks the peak of the US Q2 earnings season. The earnings reports from several core tech giants (the "Magnificent Seven") showed a clear pattern of divergence, becoming the core driver of individual stock volatility and sector rotation.
1. Cloud Computing & AI Infrastructure: Earnings Beat Expectations, Capital Expenditure Continues to Increase
Among the tech giants that have already reported earnings, core cloud service providers delivered impressive results. Benefiting from the substantial implementation of enterprise AI deployment demand, cloud business revenue growth returned to a double-digit range above 20%. More crucially, these giants raised their capital expenditure expectations for 2026 in their earnings guidance. This further confirms that the industrial logic of the AI computing power arms race remains intact. For upstream and downstream enterprises in the AI hardware, PCB, and optical module industries, the certain growth in giant capital spending means high revenue visibility for the coming quarters remains extremely high.
2. Consumer Electronics & Smart Driving: Growth Bottlenecks Emerge, Valuations Face Repricing Pressure
In contrast, earnings reports from some tech giants primarily focused on consumer electronics and smart terminals appeared lackluster. Due to weaker-than-expected global consumer demand recovery and a lengthened replacement cycle for next-generation AI terminal devices, their hardware revenue experienced a year-on-year decline. Furthermore, the commercialization process of autonomous driving businesses fell short of market expectations due to stricter regulatory approvals. Following the earnings releases, related stocks saw significant declines in after-hours trading, with single-day drops exceeding 6% at one point. This indicates that the market's tolerance for "AI monetization" is decreasing, and AI concept stocks lacking substantial performance delivery are facing a brutal valuation bubble deflation process.
US Stock Investment Strategy & Market Trend Analysis: Grasping the Dual Main Themes of "Loose Money + Real Earnings"
At the current juncture, TWSEHK believes that the US stock market has entered a new phase where macro and micro factors resonate. When formulating US stock investment strategies, investors need to be wary of the structural risk where "index prosperity masks individual stock divergence."
Firstly, while the rate-cut frenzy triggered by the nonfarm payroll data has pushed up valuations in the short term, the rapid rise in the unemployment rate also harbors hidden concerns about an economic recession. If subsequent PMI and retail sales data continue to weaken, the market could quickly switch from a "celebrating rate cuts" to a "fearing recession" trading logic. Therefore, in position management, it is advisable for investors to maintain moderate positions and avoid blindly chasing highs.
Secondly, in the allocation of tech stocks, one should strictly distinguish between the investment logic of "AI infrastructure" and "AI terminal applications." The earnings season has proven that computing power demand remains the most certain fundamental currently. It is recommended to continue overweighting cloud giants with strong cash flow supporting massive capital expenditures, as well as AI hardware leaders in their core supply chains. For those fringe concept stocks with vague earnings guidance and excessive reliance on future narratives to support valuations, decisive position adjustments should be made during rebounds.
Preview of Key US Stock Market Events Next Week
Looking ahead to next week, the US stock market will see speeches from several Federal Reserve officials. Following the weak nonfarm payroll data, the market will closely watch whether these officials guide expectations regarding the pace of rate cuts. Additionally, the US July CPI data will be released next week, which will be the most important inflation reference before the Fed's September FOMC meeting. If the CPI further confirms a cooling inflation trend, US stocks are expected to maintain strength under loose monetary expectations; conversely, if inflation proves sticky, the market may correct overly aggressive rate-cut expectations, and high-valuation tech stocks could face short-term volatility pressure. Investors need to closely monitor pre-market and after-hours data and real-time US stock market quotes to flexibly respond to market changes.
