AI bulls encounter their first hard threshold after the surge at the end of July! Kalshi jumps ahead of Wall Street and issues a non-farm payroll warning for July.

The U.S. Bureau of Labor Statistics is set to release the non-farm payroll report for July on Friday morning local time. According to consensus estimates from Dow Jones, economists generally expect the number of new jobs added that month to be 85,000. However, bettors on the prediction market platform Kalshi believe that the actual non-farm employment data may fall below this level. For bullish traders in the stock market, particularly those focused on the semiconductor sector, a "low-growth but not stalled" non-farm labor market is something they are keen to see. Speculators on prediction market companies like Polymarket and Kalshi seem to think the probability of U.S. employers adding more than 80,000 jobs in July is only 47%; they also believe there is about a 60% chance that new jobs will exceed 70,000 for the month. Contracts on the Kalshi prediction platform require traders to predict whether the July job data will exceed a set of given thresholds. These contracts will be settled in cryptocurrency or stablecoins based on the official data released by the U.S. Bureau of Labor Statistics. While the likelihood is low, it is not impossible for the actual data to exceed market consensus expectations. Some speculators appear to believe that the probability of U.S. employers adding 90,000 jobs in July is 41%, with the chances of hitting a six-digit figure slightly above one-third. However, the speculation on the prediction platform also suggests that the probability of the data being below 60,000 is one-third. This indicates that the central expectation of the prediction market speculators remains close to the range of 70,00080,000, while they are evidently cautious about the tail risk of falling below 60,000. Last month, bettors on the Kalshi platform unanimously believed there was a 63% probability of employers adding more than 125,000 jobs in June, higher than the market consensus of 115,000. However, the official data released by the U.S. government was far below this level, showing only 57,000 new jobs were added that month. The U.S. Bureau of Labor Statistics will release the employment report for July on August 7. A Reuters survey of economists shows that, on average, they expect non-farm payrolls to increase by around 83,000 to 85,000, with an unemployment rate of about 4.3%. Other survey reports suggest a median estimate roughly between 82,000 and 90,000, while more optimistic Wall Street firms like Barclays predict around 100,000 jobs. Compared to June, which saw only 57,000 new jobs and an unemployment rate of 4.2%, the consensus expectations essentially bet on a "low growth but not stalled" moderate growth labor market. An ideally soft landing for non-farm payrollswhere job creation slows modestly, the unemployment rate changes only slightly, and wage growth continues to coolwould reduce pressure on inflation and subsequent rate hikes by the Federal Reserve, lowering real interest rates and discount rates. It would also avoid triggering an economic recession, corporate profit downgrades, or cuts in AI capital expenditures. After June's non-farm increase of only 57,000, the market gained breathing room as the cooling labor market weakened recent rate hike expectations. Non-farm payrolls have become a critical "line for life or death" for tech stock bulls: a mild cooling in employment is the ideal fuel for a rebound in AI themes. For global stock market bulls, the most favorable outcome isn't simply a stronger non-farm report but a new job creation of about 70,000 to 100,000, with the unemployment rate stable at 4.2% to 4.3%the "Goldilocks portfolio," where wage growth is not excessively hot. This would demonstrate that U.S. consumer spending and corporate profits are not sliding into recession while not forcing the Federal Reserve to tighten its rate-hike trajectory, thereby lowering real interest rates and equity risk premiums, particularly benefiting longer duration and the most valuation-sensitive AI infrastructure and AI application stocksincluding semiconductors, electronic components for data centers, and AI application software assets. If job creation significantly exceeds 100,000 and wage growth accelerates again, the market may interpret this as continued overheating demand, raising probabilities for a September rate hike and causing the dollar and U.S. Treasury yields to potentially rise. By the end of July, the market had priced in about a 64% chance for a September rate hike, and the 30-year U.S. Treasury yield had briefly risen to around 5.24%, leaving high-valuation growth stocks with little room to tolerate a second round of rate pressures. Conversely, if job creation is below the critical market threshold of 60,000, accompanied by rising unemployment, declining hours, and significant downward revisions of previous data, bonds may initially rise, but the trading logic could quickly shift from "rate-friendly" to "earnings recession," putting pressure on cyclical stocks, financial stocks, and the global export market. Therefore, non-farm payrolls serve as a test to determine whether the violent rebound at the end of July was a technical correction after a strong unwinding or the first hard threshold for a new wave of risk appetite. On August 3, hopes of negotiations with Iran pushed crude oil down about 5%, and U.S. Treasury yields fell, leading the S&P 500 and Nasdaq to rise by 1.48% and 2.13%, respectively, indicating that the current bulls still heavily rely on the resonance of "falling oil prices + falling rates + strong tech earnings"; if the non-farm data is too strong, it will raise interest rate anchors and compress AI valuations, while if it is too weak, it will shake earnings and credit quality. The market continues to embrace a bullish direction in August, and what is really needed is not a single favorable factor, but a mild cooling in employment, further declines in oil prices, and resilient corporate earnings. Only in this way can the leveraged positions and extremely crowded positions of July's forced liquidation and clearing turn into a healthy trend of capital reinvestment; otherwise, the current rebound may still just be a high volatility correction generated from extreme deleveraging.