Germany ZEW Survey – Current Situation registered at -81, below expectations (-77.5) in June

Driven by stronger-than-expected U.S. August nonfarm payrolls data, market expectations grew that the Federal Reserve might raise interest rates at its next policy meeting, sending major U.S. stock indices lower. Semiconductor stocks bucked the trend to move higher, with memory and optical communications stocks leading the gains. At the close, the Dow Jones Industrial Average fell 0.51% to 53,414.25; the Nasdaq Composite Index slipped 0.29% to 26,506.99; and the S&P 500 Index lost 0.38% to 7,718.60.

According to Yonhap News Agency on September 4, citing industry insiders, Micron (MU) plans to boost its monthly High Bandwidth Memory (HBM) capacity to approximately 100,000 wafers by the end of 2026, nearly doubling from last year's level. If the target is achieved as scheduled, the capacity gap between Micron and Samsung Electronics as well as SK Hynix could narrow to roughly half of its current size.

On September 4 Eastern Time, US August non-farm payrolls significantly exceeded expectations, fueling expectations of a Federal Reserve rate hike. US Treasury yields subsequently moved higher, with the 2-year Treasury yield touching its highest level since January 2025. Markets expect the Fed could raise rates within a few weeks; according to the CME FedWatch Tool, Federal Funds futures traders currently price in a 58% probability of a rate hike. Although this stronger-than-expected employment data was expected to weigh on high-valuation growth stocks, the US semiconductor sector rallied sharply in early trading today.

TradingKey - On Friday (September 4) Eastern Time, futures on the three major US stock indices were mixed in premarket trading. Dovish signals from Federal Reserve officials prompted the market to reassess the likelihood of a September rate hike, while investors remained cautious ahead of the upcoming release of the crucial US non-farm payrolls report.

TradingKey - In U.S. pre-market trading on September 4, the three major stock index futures diverged. As of press time, Dow Jones futures fell 0.09%, S&P 500 futures rose 0.09%, and Nasdaq 100 futures gained 0.53%.