Preview of US Stock Market | All three major stock index futures are rising together, oil prices are falling, and the Federal Reserve's interest rate decision is set to arrive tonight with major impact.

**Premarket Market Moves** 1. On Wednesday, September 16, ahead of the U.S. stock market open, all three major U.S. stock index futures rose together. As of press time, Dow futures were up 0.26%, S&P 500 index futures were up 0.25%, and Nasdaq futures were up 0.51%. 2. As of press time, Germany's DAX index was up 0.24%, the U.K.'s FTSE 100 was up 0.60%, France's CAC 40 was up 0.53%, and the Euro Stoxx 50 was up 0.55%. 3. As of press time, WTI crude oil fell 2.38% to $103.31 per barrel. Brent crude oil fell 1.49% to $107.13 per barrel. **Market News** The Federal Reserve's interest rate decision is arriving with major impact! At 2 a.m. Beijing time on Thursday, the Federal Reserve will announce its interest rate decision and latest economic projections. Half an hour later, Federal Reserve Chairman Warsh will hold a press conference. A month ago, the market saw only a 33.1% probability of a rate hike this time; now that number is close to 95%, and market pricing for a hike has become almost one-sided. If the Federal Reserve raises rates as expected, this will also be the Fed's first rate hike in more than three years. However, what the market is really waiting for is not the 25-basis-point hike itself, but three more important signals. How does the Federal Reserve judge the oil price shockis it a short-term disturbance, or will it spread to wages, service prices, and long-term inflation expectations? Is this just an adjustment, or the beginning of a new rate hike cycle? And how much economic and market pressure is Warsh willing to endure in order to push inflation down? White House pressure fails to block the hawkish shift! The Federal Reserve's rate hike is imminent, and the relationship between Warsh and Trump faces a major test. The market expects the Federal Reserve to raise rates on Wednesday, the first time since 2023because policymakers are losing confidence that inflation can cool sufficiently without at least a push from the central bank. This is very likely to strain the relationship between Chairman Warsh and U.S. President Trump. A rate hike could invite new criticism from the White House. Just last Sunday, Trump repeated his argument that the United States should have the world's lowest borrowing costs. Since Trump appointed Warsh to succeed Powell as chairman, the president has significantly toned down his attacks on the Federal Reserve. He even suggested that Warsh is being pressured by other Fed officials to raise rates, and accused those officials of being "very political." But in a late-August speech, Warsh made clear that underlying price pressures have not improved substantially, and that if the Federal Reserve does not receive new assurances confirming inflation is on a path toward the central bank's 2% target, then the Fed "still has work to do." Doves defect! Nomura: Two major reasons will prompt the Federal Reserve to raise rates twice this year. Nomura, long seen as leaning dovish within the Wall Street camp, has recently made a rare reversal of its previous forecast for rates to remain on hold, choosing a full shift to a hawkish stance. The institution's latest assessment shows that the Federal Reserve is expected to raise its policy rate twice in a row this year, in September and December, by 25 basis points each time, meaning the U.S. tightening cycle may extend further into the future. Nomura's major reversal is not without basis; it is mainly driven by two strong real-world factors: first, signs of setbacks in the U.S. fight against inflation, and second, a more distinctly tightening preference in the policy communication style of the Federal Reserve's core leadership. In Nomura's view, the stalling of disinflation momentum is fundamentally forcing the Federal Reserve to reopen the tightening valve. In addition, the tough stance conveyed by Warsh is substantially at odds with the market's previous broad bet on a "long pause in rate hikes," directly breaking the balance of keeping policy at the status quo. Do not fight the earnings cycle! Will U.S. stocks break 8,000 points this year? Jefferies Financial Group Inc. expects that, driven by the dual engines of an AI investment frenzy and better-than-expected corporate earnings growth, the S&P 500 will surge to 8,000 points by the end of this year and further reach 9,000 points in 2027. The report argues that despite macro headwinds such as rising 10-year U.S. Treasury yields, sticky inflation, and the midterm elections, corporate fundamentals will still be the core DRIVE determining returns. Jefferies Financial Group Inc.'s core logic is clear and powerful: in a cycle where earnings growth exceeds the historical average by more than twofold, fighting the earnings trend is dangerous. In addition, Jefferies Financial Group Inc. believes that AI-driven earnings expansion is spreading from the Magnificent Seven to the broader market, providing a more solid foundation for the market. It should focus on overweight sectors with strong earnings revisions and macro support, such as technology, financials, healthcare, and materials, to seize this rare earnings super-cycle amid concerns about valuation compression. However, Jefferies Financial Group Inc. also specifically pointed out two core risks in the report: first, a substantial slowdown in earnings growth at AI-related companies, which would directly shake the foundation of the entire bull market logic; second, a continued rise in 10-year U.S. Treasury yields, which would create systemic pressure on stocks through the valuation compression channel. The "AI slowdown thesis" collides with the 5% "anchor of global asset pricing," and tech risk surges! Wells Fargo & Company redraws the U.S. equity investment map and cuts its S&P 500 target. Wells Fargo & Company Chief Equity Strategist Ohsung Kwon lowered the S&P 500 year-end target to 7,700 points from 7,950 points, and downgraded the technology sector to "equal weight" from its previous "overweight" rating, because the upcoming midterm elections are increasingly becoming a risk for the sector, especially as opposition to data center development grows. The strategist is increasingly concerned that years of earnings expansion have pushed market expectations close to historic highs, while AI capital expenditures, state government policy restrictions on data center construction, and uncertainties over fiscal and monetary policy have recently been intensifying. Notably, the strategist did not show much concern about 2027 earnings, with the key caution being that a slowdown in capital expenditures related to AI data center construction could hit 2028 profits. Therefore, this adjustment is closer to a reassessment of the market's forward valuation for U.S. equities. **Individual Stock News** U.S. optical communications stocks rose broadly in premarket trading. On Wednesday ahead of the U.S. stock market open, as of press time, Nokia Oyj Sponsored ADR (NOK.US) rose more than 6%, while Coherent (COHR.US) and Lumentum (LITE.US) rose more than 3%, and Corning Inc (GLW.US), Marvell Technology, Inc. (MRVL.US), Credo Technology (CRDO.US), and Astera Labs (ALAB.US) rose nearly 2%. SK Hynix (SKHY.US) is reportedly planning to make memory chips in the U.S. for the first time, leasing part of Intel Corporation's (INTC.US) Ohio plant or forming a joint venture. South Korea's SK Hynix is reportedly in talks with Intel Corporation on a deal that, if completed, would mark its first production of memory chips on U.S. soil. One potential option is for SK Hynix to lease part of Intel Corporation's long-planned wafer fab in Ohio; another is to form a joint venture with Intel Corporation and major cloud providers eager to secure memory chip supply. But sources said potential opposition from the South Korean side could pose a major obstacle. One source said the talks are still exploratory and stressed that no decision has been made; SK Hynix may also consider other transaction structures. SK Hynix said in a statement that it is "evaluating various measures, including establishing more production bases, to enhance the competitiveness of its memory business," but that "nothing has been decided at present." Meta (META.US) doubles down on self-developed AI chips! Deployment in data centers in the first half of next year, aiming to reduce inference costs and energy consumption. Meta plans to deploy a new generation of self-developed artificial intelligence chips in data centers in the first half of 2027, hoping to use custom chips to reduce the energy consumption and cost of running AI models. At the same time, the company has already committed more than 1 gigawatt of deployment scale for the related chips, and said that if AI demand remains strong, the pace of subsequent deployment will accelerate further. Meta Vice President of Engineering Yee Jiun Song said the company's third-generation self-developed AI processor, MTIA 450, is currently in testing, and the chip is codenamed "Arke." Arke has now entered actual testing. On September 1, the first 12 Arke chips were delivered to Meta by Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR, with the gap between actual performance and previous simulation results at only 2% to 3%. Starbucks Corporation (SBUX.US) is reportedly considering selling a majority stake in its Japan business, with a valuation that could reach $3 billion. According to two people familiar with the matter, Starbucks Corporation is considering selling a majority stake in its Japan business, a potential deal that could value the coffee chain giant's largest self-operated overseas market at about $3 billion. The people said Starbucks Corporation has consulted multiple financial advisers on various options for the business and is willing to sell a majority stake. One of the people said the final stake size to be sold has not yet been determined, and the valuation Starbucks Corporation ultimately seeks will also depend on negotiation results. The potential sale comes as Starbucks Corporation realigns its global business portfolio under Niccol's leadership. Niccol has closed stores and cut corporate jobs in North America to help restore profitability. The people said the process of divesting a majority stake in Starbucks Corporation's Japan business is expected to attract interest from global and local private equity buyout firms. One of the people added that a formal sale process could begin in the fourth quarter. Wall Street giants' trading businesses show a "tale of two cities": JPMorgan (JPM.US) expects a surge in Q3 results, while Bank of America Corp (BAC.US) warns of a slowdown. JPMorgan co-president Doug Petno said on Tuesday that trading revenue for the quarter ending September 30 is expected to rise in the mid-to-high teens percentage range. He also said JPMorgan's investment banking fee revenue could rise by a similar magnitude. Just a day earlier at the same conference, Bank of America Corp CEO Brian Moynihan said third-quarter revenue would be "roughly flat" compared with the same period in 2025. Moynihan said the bank saw a pullback in financing business, partly due to a slowdown in Asia prime brokerage balances. **Key Economic Data and Event Preview** 20:30 Beijing time: U.S. August retail sales month-over-month 02:00 Beijing time the next day: Federal Reserve announces interest rate decision 02:30 Beijing time the next day: Federal Reserve Chairman holds monetary policy press conference