Next week's heavy schedule: September 3rd military parade, SCO summit closing, U.S. non-farm payrolls

September 1 - September 7 Weekly Major Financial Events Overview, all times in Beijing:

This week's key focus: September 3 Military Parade, Shanghai Cooperation Organization Summit Closing, U.S. August Non-Farm Payroll Data, S&P Global August China Manufacturing PMI.

In addition, the U.S. will release August ADP Employment Change, ISM Manufacturing and Non-Manufacturing Index, July Durable Goods Orders Final Value, the Federal Reserve will publish the Beige Book, a decentralized finance project supported by the Trump family will officially launch, and Nio, Broadcom, Salesforce, C3.ai, and Lululemon will announce their earnings reports.

Economic Indicators

• U.S. August Non-Farm Employment Change

On September 5, the U.S. will announce the August Non-Farm Employment Change. Last month's U.S. non-farm data was a "shock," with an increase of only 73,000 jobs, far below expectations, and the data for the previous two months was significantly revised down by 258,000.

Goldman Sachs traders believe that Federal Reserve Chairman Jerome Powell has given the green light for a rate cut in September, but the August non-farm employment data will be a key factor in determining the magnitude and pace of the rate cut. If job growth is below 100,000, it will help confirm a rate cut in September. Powell's remarks at the Jackson Hole central bank annual meeting, particularly his reiteration of "downside risks to the labor market," have paved the way for a rate cut. This statement echoes his concerns from the last FOMC press conference, reflecting the Fed's high attention to the job market.

Goldman Sachs' negative revision of future job growth is based on four reasons: the birth-death model may be overly optimistic; historically, revisions to original employment data during economic slowdowns are often negative; ADP data raises questions about official healthcare sector job growth; and household surveys overestimate immigration and job growth. The firm is particularly concerned that "catch-up hiring" in a few industries has ended, and job growth outside these industries has dropped to nearly zero levels. If balanced job growth is indeed around 80,000 as Goldman Sachs estimates, the current data is "concerning."

Goldman Sachs believes that the Fed will "cautiously observe" the labor market after the rate cut in September, looking for further signs of weakness to determine the subsequent path. There is a high likelihood that the rate cut cycle will be completed before the next Fed chair takes office, with Powell's term ending in May next year. Goldman Sachs concludes that if weakness is to come, it will be evident in the next few data releases; if not, the current weakness may just be a fleeting moment.

• U.S. August ADP Employment Change

Last month's data showed that the U.S. private sector added 104,000 jobs in July, exceeding economists' expectations, but still far below last year's average level. Against the backdrop of increasing uncertainty regarding Trump's policies, employers are becoming cautious in their hiring decisions, and overall demand in the labor market remains weak.

• China August S&P Manufacturing PMI On September 1, S&P Global announced China's manufacturing PMI for August. The data recorded last month was 49.5, indicating a slight weakening in manufacturing sentiment, a decline in exports, and a slowdown in the growth of new orders. However, business confidence is expected to improve in the first half of 2025, with average input prices rising for the first time since February. Due to an improved output outlook for the next year, corporate purchasing activities have also seen a slight increase.

• U.S. August ISM Manufacturing and Non-Manufacturing Index

On September 2, the U.S. released the ISM manufacturing index for August. Last month, the U.S. ISM manufacturing index remained below the expansion threshold for five consecutive months, recording 48, which was below the expected 49.5. The new orders index contracted for the sixth consecutive month, but manufacturers experienced some relief from raw material cost pressures. The employment index further declined, falling into contraction. Respondents indicated that controlling employee numbers remains the norm for their companies, with businesses still cautious about hiring. The non-manufacturing index will be released on the 4th.

• U.S. July Durable Goods Orders Month-on-Month Final Value

On September 3, the U.S. announced the month-on-month final value of durable goods orders for July. Last month's data showed that U.S. durable goods orders fell sharply by 9.3% in June, marking the largest decline since April 2020. This significant fluctuation was mainly due to a substantial adjustment in non-defense aircraft orders, which surged by 230% month-on-month in May but fell by 50% in June, reflecting a cautious attitude towards capital expenditures amid uncertainties in trade and fiscal policies.

Financial Events

• September 3 Military Parade

According to CCTV News, a grand ceremony was held on the morning of September 3 at Tiananmen Square in Beijing to commemorate the 80th anniversary of the victory of the Chinese People's Anti-Japanese War and the World Anti-Fascist War, including a military review.

According to reports from CCTV News and Xinhua News Agency, relevant officials introduced that the parade activities were conducted in two steps: the parade and the column display, lasting about 70 minutes. The weapons and equipment on display were selected from domestically produced active main battle equipment, with a significant proportion of new equipment making its debut. Some strategic heavy equipment from land, sea, and air bases, as well as hypersonic, unmanned, and anti-unmanned equipment, were showcased for the first time.

A relevant official from the State Council Information Office stated that the number and types of equipment on display reached over a hundred. We organized a lean support force according to wartime requirements, and the joint support of equipment extended to the tactical level, efficiently supporting the implementation of high-intensity and fast-paced training throughout the event.

The aerial formation was organized in a modular and systematic manner, consisting of advanced early warning command aircraft, fighter jets, bombers, and transport aircraft, covering the main battle aircraft types currently in service in our military. Many of these are star equipment that has attracted public attention, with some making their first public appearance, fully demonstrating the leapfrog development of our military's aerial combat capabilities Currently, all preparations for the military parade have been basically completed. All participating officers and soldiers will accept the review of the Party and the people with a high-spirited state of mind, jointly welcoming September 3rd, a victory day that deserves to be remembered by the people of the world forever.

• The decentralized finance project supported by the Trump family plans to officially launch the public trading of its WLFI token on September 1st

According to the World Liberty Financial platform, this decentralized finance project supported by the Trump family plans to officially launch the public trading of its WLFI token on September 1st. The token generation event (TGE) will take place at 12:00 PM UTC on that day, and this Ethereum-based token will be distributed through a system called "Lockbox."

At that time, early investors who purchased the token at $0.015 and $0.05 will be able to unlock 20% of their total token holdings, accounting for approximately 5% of the total supply. The remaining 80% will be subject to community governance, while the distribution for founders, advisors, and partners remains locked. The WLFI token is expected to be listed on major cryptocurrency exchanges such as Binance, Coinbase, and Hyperliquid.

This issuance has generated a huge response in the market. According to Cryptonews, based on the estimated futures price of the token, the fully diluted valuation of WLFI has exceeded $40 billion, with the tokens held by Trump himself valued at over $6 billion. Current futures prices show WLFI trading in the range of $0.20 to $0.30, significantly higher than its presale price, reflecting strong market interest and complex expectations for the project.

• The Federal Reserve releases the Beige Book on economic conditions

On September 4th, the Federal Reserve released the Beige Book on economic conditions. The Beige Book from last month indicated a slight increase in economic activity from late May to early July. The number of mentions of inflation hit a four-year low, with only 5 mentions, down from 10 in the previous report, while the term "slowdown" was mentioned at a record high since October of last year.

Goldman Sachs believes that the core risks currently facing the U.S. market and economy are no longer the financial excesses of the private sector, but rather the increasingly severe public sector debt issues and high asset valuations.

Financial Reports

• Broadcom

Broadcom sent a clear signal during a management meeting in July—demand for AI inference is not only rapidly increasing but is still in the early stages of an upward trajectory, and future reassessments of market size and capacity allocation may lead to systematic profit upgrades.

At an investor meeting organized by JP Morgan recently, Broadcom's management revealed that the company is experiencing unexpected demand growth in the AI inference sector, even "exceeding current capacity," and this trend has not yet been incorporated into previous market size forecasts, potentially providing room for future profit upgrades. Meanwhile, non-AI business is also beginning to recover, with VMware continuing to ramp up, and the company is overall "firing on multiple fronts."

Broadcom CEO Hock Tan and CFO Kirsten Spears stated that over the past year, AI demand has primarily come from training loads, especially the training of "cutting-edge models." However, in the past two months, the company has seen a significant increase in orders for AI inference. Management pointed out that this wave of inference demand comes from customers wanting to monetize their AI investments more quickly, and "the market capacity for inference may be severely underestimated."

• Nio

Nio will announce its financial report on September 2nd. JP Morgan has upgraded the rating of Nio's American Depositary Receipts (ADR) from "Neutral" to "Overweight." The institution's analysts, including Nick Lai, stated in a report:

"The financial report itself may not bring too many surprises, but we expect general earnings expectations to be raised, especially as the company's losses are expected to narrow quickly."

In addition, JP Morgan has also raised the target price for Nio's ADR from $4.80 to $8