Tech Stocks Extend Rally, U.S.-Iran Tensions Ease, Chinese ADRs Plunge

Market Overview

U.S. equities extended their gains on Friday, led by technology and semiconductor stocks. The S&P 500 rose 0.37%, while the Dow Jones Industrial Average advanced 0.58%. Progress in U.S.-Iran negotiations weighed on energy markets, sending Brent crude down more than 5% for the week. Meanwhile, Chinese online brokerage stocks suffered a sharp selloff following new regulatory measures, with Futu and Tiger Brokers each falling at least 25%. Bitcoin dropped below $76,000 to its lowest level this month, while comments from Federal Reserve Governor Christopher Waller triggered a V-shaped reversal in both the U.S. dollar and Treasury yields.

Chinese Online Brokers Tumble as Cross-Border Trading Faces Regulatory Crackdown

China's securities regulator and seven other government agencies jointly announced a comprehensive campaign to eliminate illegal cross-border securities, futures, and fund operations. A two-year rectification period has been established, during which investors will be prohibited from opening new positions and may only close existing ones. The announcement triggered a massive selloff in Chinese online brokerage firms, with Futu and Tiger Brokers each losing more than 25%, while Futu reportedly received a regulatory penalty of RMB 1.85 billion. Existing investors will still be able to access overseas markets through approved channels such as Stock Connect and QDII programs.

AI and Semiconductor Stocks Lead Gains as Lenovo Delivers Strong Earnings

The semiconductor sector continued to outperform, with the Philadelphia Semiconductor Index gaining 2%. Qualcomm surged more than 11%, AMD rose 4%, while Dell and HP each advanced at least 15%. Lenovo reported a 105% year-over-year increase in AI-related business revenue, reinforcing optimism across the broader technology supply chain. Nvidia declined for a second consecutive session following its earnings release and finished the week down more than 4%. Meanwhile, quantum computing stocks also attracted strong buying interest, with Rigetti Computing climbing approximately 20%, highlighting continued sector rotation within technology.

Waller: Rate Hike and Rate Cut Odds Are “50-50”

Federal Reserve Governor Christopher Waller stated that the probabilities of further rate hikes and rate cuts are currently “50-50.” His remarks prompted a sharp intraday reversal in both the U.S. dollar and Treasury yields. The 2-year Treasury yield climbed to its highest level in more than a year as short-term rate expectations shifted toward a more restrictive policy outlook. Markets have increasingly priced in the possibility of another rate hike before year-end. Former President Donald Trump also weighed in on inflation, stating that policymakers should “stop inflation, not stop greatness,” highlighting growing tension between the White House and the Federal Reserve.

U.S.-Iran Talks Advance, Sending Oil Prices Lower

President Trump stated on Saturday that a nuclear agreement with Iran was “essentially completed,” but later clarified on Sunday that negotiations had not yet been fully finalized. Brent crude declined more than 5% for the week, while both WTI and Brent crude futures fell sharply during early Asia-Pacific trading, dropping over 4% and 5%, respectively. U.S. media reports suggested Iran may be willing to abandon high-level uranium enrichment, while Iranian officials reiterated that the Strait of Hormuz would remain under Iranian administration. Iran has not yet made formal commitments on key nuclear issues, leaving room for renewed geopolitical risk premiums in energy markets.

Market SpotlightAnthropic Nears Massive Funding Round

Anthropic is reportedly on track to complete a funding round exceeding $30 billion as early as this week, potentially pushing its valuation above $900 billion and placing it among the world's most valuable AI companies. At the same time, Microsoft has reportedly discontinued licensing Claude due to high token-related operating costs, highlighting the growing monetization challenges facing frontier AI models and the increasing focus on cost efficiency among hyperscalers.

Space and Aerospace Themes Gain Momentum

SpaceX successfully completed another Starship launch, fueling renewed enthusiasm around potential IPO-related opportunities and driving strong investor interest in the space sector. U.S. space-focused ETFs attracted approximately $1.3 billion in net inflows over the past month. Meanwhile, China's Shenzhou-23 crew successfully entered the Tiangong Space Station at 05:13 Beijing time on August 25, underscoring intensifying competition and investment across both commercial and government-led space programs.