Strong Data Fails to Lift the Dollar; U.S. Equities, Gold, and Oil Hit Fresh Highs

Market Overview

On Thursday, upbeat U.S. economic data bolstered investor sentiment, even as the dollar extended its decline. The second-quarter GDP growth was revised higher, while jobless claims and other labor-market indicators came in stronger than expected, underscoring the resilience of the U.S. economy.

Risk appetite strengthened, driving U.S. equities to new milestones. The S&P 500 closed above the 6,500 mark for the first time in history, setting a fresh record high. Technology stocks led the rally, with Snowflake surging 20% on strong earnings, while Nvidia slipped 0.8% following its results. The VIX volatility index fell toward its lowest level of the year, pressured by speculative short positioning.

In currencies, the U.S. dollar index declined for a third consecutive session. The offshore Chinese yuan strengthened sharply, touching a year-to-date high of 7.1188. Commodities gained across the board: gold rose for a third straight day and broke above the $3,400 threshold, silver climbed 1.2%, and oil prices moved higher in tandem.

Hot Topics to Watch

U.S. Q2 Real GDP Revised Up

Second-quarter real GDP expanded at an annualized pace of 3.3%, compared with the prior estimate of 3.0%. The upward revision was mainly driven by business investment, which was revised from 1.9% to 5.7%, reflecting stronger spending on software and transportation equipment. Net exports contributed nearly five percentage points to GDP, the highest on record.

Mainland A-shares Stage Afternoon Rebound

Chinese equities staged a sharp comeback, with the Shanghai Composite surging over 2% from intraday lows, while the STAR 50 Index jumped more than 7%. Semiconductor and computing hardware stocks outperformed, with Cambricon soaring over 15% to reclaim the “chip king” title. In contrast, Hong Kong equities remained weak as internet stocks slid; Meituan dropped more than 11%. Meanwhile, Chinese government bonds slumped in the afternoon, and commodities extended losses.

Key Events Ahead (GMT+8)

20:30 – U.S. July Core PCE Price Index (YoY/MoM), U.S. July Personal Spending (MoM)

21:45 – U.S. August Chicago PMI

22:00 – U.S. August University of Michigan Consumer Sentiment (Final), U.S. August 1-Year Inflation Expectations (Final)