U.S. Stock Market Outlook This Week First up is the U.S. September CPI (to be released at 8:30 PM Beijing time on October 14) Recent cooling in non-farm payroll data, coupled with a series of dovish signals from Fed officials, has caused market expectations for an October rate hike to drop from 70% to less than 20%. Currently, the market expects overall CPI to rise 3.6% year-over-year, with core CPI up 2.5%. If the data comes in below expectations, an October rate hike pause is almost certain, and the next potential rate hike window will likely be pushed to December. Keep in mind, as long as this rate hike doesn’t evolve into a sustained cyclical tightening, the short-term market impact will be limited, and the long-term trend remains unchanged. Second is TSMC’s earnings report, to be released before the market opens on Thursday (2:00 PM Beijing time on October 15) Why is this earnings report important? The market is currently concerned about the sustainability of AI demand. Recently, OpenAI disclosed an ARR of about $50 billion, which is below the previous market expectation of $70 billion, causing a temporary dip in AI-related stocks. The core issue is that if model companies can’t sustain profitability, upstream computing power and semiconductor investments will eventually be affected. So, this time, TSMC’s earnings report isn’t just about revenue and profit—it’s also about capital expenditures. Foundries, lithography machines, and etching equipment are all long-term heavy assets. Once invested, it’s hard to pull back in the short term. Whether TSMC is willing to continue expanding capital expenditures essentially reflects its judgment on future AI orders. Last quarter, TSMC already raised its full-year capital expenditure guidance to the upper end of the $52 billion to $56 billion range. This time, the market is looking for two answers: Will capital expenditures continue to increase, and will the company provide investment guidance for next year? If expectations fall short, be mindful of the risks. CPI determines short-term liquidity expectations, while TSMC determines the sustainability of the AI narrative.