Written by: Trend Research

On the first trading day after the Federal Reserve raised interest rates, the U.S. stock market quickly recovered. Oil prices fell back from this week's highs, the 10-year Treasury yield dipped below 5% again, and initial jobless claims unexpectedly dropped to 196,000, together easing the tension from the previous day. The Nasdaq led with gains, and semiconductor and AI hardware stocks became the main force of the rebound, with cryptocurrency concept stocks also boosted by new regulatory measures. The interest rate hike cycle has just restarted, and the market pricing for another hike in October has already risen to over 50%, with last night's rebound resembling a repair after the concentrated impact the day before.

Three major indices end three consecutive declines, Philadelphia Semiconductor Index rebounds 3.12%

The Dow Jones rose 0.62% to 51,779.85 points, the S&P 500 rose 1.14% to 7,637.74 points, and the Nasdaq rose 1.69% to 26,418.300 points, ending three consecutive declines. The VIX fell 12.82% to 15.44.

The Philadelphia Semiconductor Index rose 3.12% to 11,596.49 points. All seven tech giants closed up, with Nvidia rising 2.54%, Amazon rising 2.13%, Microsoft rising 1.52%, Apple rising 1.38%, Meta rising 1.34%, Google rising 1.30%, and Tesla rising about 1.2%. The Nasdaq Golden Dragon China Index rose 0.65% to 5,771.27 points.

The bond market showed a clear rebound. The 2-year Treasury yield dropped to 4.671%, while the 10-year yield dropped to 4.939%. The U.S. dollar index fell slightly by 0.03%.

WTI crude oil closed at $101.91 per barrel, and Brent crude oil closed at $104.82 per barrel. Spot gold rose to $4,342.63 per ounce. Bitcoin hovered around $76,500, while Ethereum was around $2,450.

Saudi Arabia increases transit supply, oil prices fall below $102

After the Fed's interest rate hike on Wednesday, long-term rates briefly broke through 5%, and oil prices also remained high. By Thursday, the two pressures eased simultaneously.

Saudi Arabia increased the supply of crude oil transported via Oman and moved forward with the recovery of damaged pipelines, which eased some supply concerns. Crude oil still held above $100, and the situation in the Middle East had not entirely calmed, at least not on that day adding further pressure on inflation expectations.

Last week, the number of initial jobless claims in the U.S. fell to 196,000, the lowest since mid-July, indicating a stable labor market. The housing market continued to be squeezed by high interest rates, with single-family home starts increasing by 7.6% in August, but building permits fell by 1.8%; overall housing starts decreased by 2.6%.

The expectations for further interest rate hikes from the Fed have not disappeared. Futures pricing for a 25 basis point rate hike in October rose to 53.1%, up from only 27.2% a week ago. Last night's stock and bond rebound was more of a recovery after the concentrated shock the day before.

Chip stocks collectively rebound, AI hardware becomes the main focus again

Semiconductors were one of the strongest sectors last night.

Arm rose 8.6%, Intel rose 7.7%, AMD rose 6.5%, SanDisk rose 6.2%, Micron rose 5.5%, and Marvell rose 4.8%. On Monday, AI hardware had just experienced a sharp decline, and after several trading days, it has recovered much of its lost ground.

There were also new order clues from the industrial side. GlobalFoundries and Marvell are expanding their long-term cooperation, which will increase the production capacity of silicon-germanium chips used for high-speed optical connections in AI data centers, covering pluggable optical modules, near-package optics, and co-packaged optics. The significance of this cooperation lies in the fact that the expansion of AI data centers is shifting from merely stacking GPUs to synchronous upgrades in interconnect parts.

This news, combined with the recent strength in optical communications, suggests that investments in AI infrastructure are continuing to spread to connectivity issues. As the number of GPUs increases, how data can be transmitted quickly between chips and servers has become another bottleneck in the expansion of data centers.

CoreWeave's performance was much weaker, with its stock price falling 4.2%. The company plans to issue $3 billion in convertible bonds while starting a stock financing plan. The demand for AI computing power remains strong, but the financing costs for companies with high capital expenditures will still be priced separately by the market.

Beyond chips, the cryptocurrency sector also received a boost from new regulatory measures that day.

SEC lifts restrictions on tokenized stock experiments, cryptocurrency concept stocks rise

The U.S. SEC has introduced a five-year exemption for tokenized stock trading, allowing qualifying platforms to operate outside certain current exchange and broker rules.

Circle rose 5.8%, Coinbase rose 5.8%, and Robinhood rose 5.2%.

This new regulation covers tokenized securities that correspond to actual stock ownership, and investors still enjoy shareholder rights such as dividends and voting, while synthetic tokens that merely track stock prices are not included in the exemption. For exchanges and brokers, the exemption means they can test the issuance, trading, and clearing processes for tokenized stocks within a compliant framework without waiting for Congress to pass comprehensive cryptocurrency legislation.

Previously, the U.S. Senate failed to advance the cryptocurrency market structure bill, putting the sector under pressure for a time. This move by the SEC directly provides a testing space, opening a clearer path for tokenized stocks to land in the U.S.

Today's Focus

Tonight, the focus is on the quarterly triple witching day. Stock index futures, index options, and single-stock options will all expire, and end-of-day trading and volatility may significantly increase.

Tech stocks continue to focus on semiconductors and AI hardware. The Philadelphia Semiconductor Index has quickly recovered some of the losses from the start of the week; today, it is more important to see if funds can continue to support this, and whether this rebound can extend from chips to optical communications, storage, and other areas.

The pricing for the October interest rate hike has risen to 53.1%, and the performance of U.S. Treasury yields around 5% will directly influence the valuation environment for tech stocks next week. If the 10-year yield continues to decline, the recovery space for growth stocks will open further; if it rises above 5% again, the previous day's rebound may only be a temporary repair.