On August 1, 2026, global investors are focusing on the US stock market. Ahead of the highly anticipated July non-farm employment report, US stock futures markets showed high-level volatility, with S&P 500 index futures up 0.2%, Nasdaq 100 index futures up 0.4%, while Dow Jones Industrial Average futures slightly declined. Market sentiment is intertwined between optimism and caution, with dovish signals previously released by Fed officials providing support to the stock market, but uncertainty in employment data still prevents bulls from taking aggressive action.
Pre-market dynamics: Tech stocks lead, Chinese concept stocks diverge
As of 20:00 Beijing time, pre-market trading in US stocks shows that most large tech stocks are stronger. Nvidia, Microsoft, Apple and other giants saw slight price increases, while Tesla gained over 2% due to news of a new model launch. Notably, the semiconductor sector continued its recent upward momentum, with Philadelphia Semiconductor Index futures rising 0.8%, benefiting from continuously exceeding global AI computing power demand.
In Chinese concept stocks, Pinduoduo and Alibaba showed mixed movements in pre-market trading, with the market paying attention to the latest developments in Sino-US regulatory policies. New energy vehicle stocks were active, with NIO and XPeng both recording gains, following delivery data that exceeded expectations.
Non-farm data preview: Cooling job market may pave the way for rate cuts
The US July non-farm employment report to be released tonight at 20:30 (Eastern US time, August 1) is undoubtedly the key variable determining short-term US stock market trends. The market widely expects new employment numbers to decrease from 185,000 in June to 152,000, with the unemployment rate stable at 4.1%. If the data meets or falls below expectations, it will strengthen the argument for the Fed to start rate cuts in September, thereby boosting stock valuations.
However, economists also remind that a rebound in wage growth may trigger inflation concerns. Average hourly wages are expected to increase by 3.7% year-on-year, and if this data exceeds expectations, it may trigger a rise in Treasury yields, thus putting pressure on growth stocks.
Industry analysis: Resonance between rate cut expectations and profit growth
Earlier this week, Fed Chair Powell stated in a congressional hearing that the labor market is gradually cooling, and the central bank is more confident that inflation will return to the 2% target. Interest rate futures market data shows that the probability of a 25 basis point rate cut in September has risen from 70% a week ago to 82%. This expectation has driven rotation and rally in interest rate-sensitive sectors such as real estate and utilities.
Meanwhile, the second quarter earnings season is coming to an end, with nearly 75% of S&P 500 constituents having reported results, of which 80% exceeded expectations. Tech giants' AI capital expenditure plans remain aggressive, driving demand in the cloud computing and data center related industrial chains. Analysts believe that profit growth and rate cut expectations form the "dual engines" for the upward trend of US stocks.
S&P 500 technical analysis: Key resistance level waiting to be broken
From a technical analysis perspective, the S&P 500 index stood above 5470 points at the end of July, setting a new historical closing high. Currently, the index futures are hovering around 5520 points, with strong resistance above at the 5550 integer level in the short term. If the non-farm data is positive, the index is expected to gap up and break through, starting a new upward wave; conversely, it may pull back to the 5400 support level.
The situation with the Nasdaq is similar, with the high volatility of tech stocks making the Nasdaq prone to amplifying gains and losses at key levels. The MACD indicator shows that bullish momentum remains, but the RSI is approaching the overbought area, cautioning for profit-taking after the data release.
How Southeast Asian investors can position in US stocks
For investors in the ASEAN region, US stocks remain one of the most liquid and allocable overseas markets. Recently, trading volume in futures linked to US stock indices on the Singapore Exchange (SGX) has significantly increased, reflecting regional demand for US stock market risk exposure. Before the non-farm data release, investors are advised to adopt the following strategies:
- Control position size: Avoid heavy bets on a single data point, use index ETFs like SPY, QQQ for diversified allocation.
- Hedge risks: Buy short-term put options or use index futures for hedging to guard against volatility from data exceeding expectations.
- Focus on exchange rates: If the US dollar strengthens, US dollar-denominated stock assets become more expensive for ASEAN investors, consider timing currency exchange based on local exchange rate movements.
- Focus on cash flow: Before the arrival of the rate cut cycle, high-dividend stocks in consumer and healthcare sectors have more defensive value.
Outlook: Data is king, trend unchanged
Overall, US stocks are currently in a "policy easing expectations + profit resilience" sweet spot, with the overall trend still upward. However, the market is sensitive to non-farm data in the short term, and may experience sharp fluctuations. Regardless of the data results, as long as the Fed's rate cut path is not completely broken, buying the dip remains the mainstream strategy.
Tomorrow morning Beijing time, US stocks will end this week's trading. If the S&P 500 can hold above the 5500 level tonight, next week's bullish confidence will be more solid. Investors should closely follow subsequent speeches from Fed officials and the July CPI data in mid-August, as these will further influence the rate decision at the September meeting.
