In the market, this week saw a fluctuating upward trend across various indices. In terms of index structure, there was a divergence this week, with the ChiNext and STAR Market indices continuing to reach new highs, but starting to pull back from Thursday, while other indices continued to adjust throughout the week. In terms of industry structure, the technology sector, driven by news, saw significant gains in semiconductor and robotics-related sectors, while coal and new energy sectors also performed well this week due to anti-involution policies. In contrast, large financials and non-ferrous metals saw the largest declines.
On the macroeconomic front, the main overseas macro event this week was the Federal Reserve’s interest rate meeting. At the meeting, the Federal Reserve cut interest rates by 25 basis points as expected. In terms of economic forecasts, the Fed raised its economic growth expectations for 2025-2027 and inflation expectations for 2026, while lowering the unemployment rate expectations for 2026-2027. Regarding the interest rate path, the dot plot released at this meeting indicated an increase in the expected cumulative rate cut for the year from 50 basis points to 75 basis points. Overall, the market believes that the downside risk in the labor market is relatively certain, and the transmission of tariffs to inflation is mild. There is a high probability of another rate cut in October; by December, the impact of tariffs on inflation is expected to be fully reflected, and the Fed may decide whether to continue cutting rates based on employment performance.
This week, the main domestic macro event was the release of August’s economic data. In August, industrial added value grew by 5.2% year-on-year, and total retail sales of consumer goods grew by 3.4% year-on-year. From January to August, fixed asset investment increased by 0.5% year-on-year. The year-on-year growth rate of industrial added value in August fell to 5.2%, and the production index of the service industry also saw a decline to 5.6%. Overall production intensity has decreased, and the decline in the year-on-year growth rate of industrial added value was greater than market expectations. Notably, industries such as computer communication electronics (including consumer electronics), electrical machinery (including appliances), and metal products (components) saw significant declines in year-on-year growth rates. The year-on-year growth rate of retail sales fell to 3.4%, with the growth rate of retail sales above designated size dropping to 2.4%. The weakening of retail sales is mainly due to the overall year-on-year performance of the three major national subsidy categories: automobiles, home appliances, and communication equipment, which showed a significant decline compared to the high levels in June. The year-on-year growth rate of discretionary consumption in August dropped to -0.1%.
In terms of industry focus, this week the market concentrated on semiconductors and anti-involution themes. Regarding semiconductors, there were reports that domestic technology companies have stopped purchasing all AI chips from NVIDIA and terminated existing orders, while starting to place large orders with domestic chip manufacturers. Following this, a spokesperson for the Ministry of Foreign Affairs responded to regulatory instructions for domestic tech companies to terminate orders for NVIDIA’s RTXpro6000D chips. The semiconductor sector continued the logic of domestic substitution from the past month, pushing the index to new highs. In terms of anti-involution, this week, the “Qiushi” magazine published an article titled “Deepening the Construction of a National Unified Market,” which, combined with a series of previous articles from the “Economic Daily,” indicates that in light of the economic data from July and August, the current policy tone is to “tighten central fiscal spending and encourage private investment.” The policy is taking a “dynamic adjustment” approach, continuing to enhance previously effective policies while retracting those that have not performed well. The market is beginning to anticipate that the next steps in real estate and consumption policies will maintain continuity, while the importance of anti-involution is gradually increasing. This expectation has led to some responses in commodity futures and stocks.
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