After continuously reaching new highs, the global stock market's upward momentum has paused, with a significant sell-off in technology stocks being the main reason. Investors are reducing their holdings in tech stocks, which had previously led the market's rise for a long time. More and more people are now concerned that the rally since April may have been too fast and too fierce.
On Wednesday, August 20, S&amp;P 500 futures fell over 0.2%, European stocks opened mostly lower, and Asian markets dropped 0.8%, with technology companies like TSMC and SoftBank leading the decline. In other assets, the yield on 10-year U.S. Treasury bonds rose by 1 basis point to 4.32%, and oil prices increased by 0.6%, recovering some ground. The U.S. dollar index has risen for three consecutive days. The Reserve Bank of New Zealand cut interest rates by 25 basis points and hinted at further room for cuts, leading to a weaker New Zealand dollar and rising bonds.
Federal Reserve Chairman Jerome Powell will speak on Friday in Jackson Hole, and traders are watching to see if he will provide clear signals regarding a rate cut in September.
Here are the movements of core assets:
<blockquote>
U.S. stock futures are all down, with S&amp;P 500 and Dow futures both falling over 0.2%, and Nasdaq 100 futures down over 0.5%.
The Euro Stoxx 50 index opened down 0.46%. The German DAX index fell 0.72%. The UK FTSE 100 index dropped 0.11%. The French CAC 40 index declined 0.34%.
The Nikkei 225 index closed down 1.5%. The Topix index closed down 0.6%. The South Korean Seoul Composite Index closed down 0.7%.
The U.S. dollar index was basically flat, the euro fell slightly by 0.1%, the yen rose over 0.2%, and the pound increased by 0.1%.
U.S. Treasury yields generally rose, with the benchmark 10-year Treasury yield rising by less than 1 basis point.
Spot gold rose over 0.2%. Spot silver fell over 0.5%.
U.S. oil rose over 0.7% to above $62.80. Brent oil rose over 0.8% to above $66.30.
Bitcoin fell over 1.2% in 24 hours to below $113,700, while Ethereum dropped over 1.3% in the same period.
</blockquote>
<h2>Market Overvaluation Triggers Caution, Tech Stocks Continue to Decline</h2>
Tech stocks continued to decline after hours, with NVIDIA down 0.3%, Intel down 1.2%, and Palantir down 2.7%, marking the fifth consecutive day of decline for the stock, the longest losing streak since March. Nevertheless, Palantir remains the best-performing stock in the S&amp;P 500 this year, having risen over 108% year-to-date.
Nasdaq 100 futures fell over 0.5%.
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Bloomberg market strategist Mark Cranfield stated that ahead of NVIDIA's upcoming earnings report next week, investors are heavily selling the stock, which has become the biggest reason for the decline in global tech stocks. Given NVIDIA's significant rise since April, it now appears to be a resistance for the short-term trend of the stock market. In other words, the market's concerns about NVIDIA's excessively high valuation have begun to affect the entire tech sector amid the pre-earnings sell-off sentiment
Anna Wu, VanEck's cross-asset strategist, stated: &#34;As valuations are pushed to historical highs, traders and hedge funds often choose to withdraw.&#34; She believes that the current market decline is more a reflection of caution ahead of the Jackson Hole annual meeting and profit-taking behavior.
The team led by strategist Michael Hartnett at Bank of America recently pointed out that the rally that boosted the seven giants of the U.S. stock market since April may have gone too far. Hartnett has repeatedly warned that there is a bubble risk in the U.S. stock market this year.
Nicholas Bohnsack from Strategas noted: &#34;Everything is easy when the market is rising, and bullish arguments are hard to challenge.&#34; However, he added: &#34;Although the upward trend may still be the main trend, we are increasingly concerned that traditional risk assets (such as stocks and bonds) seem to be 'perfectly priced,' leaving very little room for error.&#34;
<h2>U.S. Dollar Index Rises for Three Consecutive Days</h2>
The U.S. Dollar Index has risen for three consecutive days and is currently basically flat.
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The Japanese Yen has slightly increased by about 0.2%.
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U.S. crude oil has risen over 0.7%.
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<h2>Market Bets on Fed Rate Cut in September Seem to Be &#34;Set in Stone&#34;</h2>
Meanwhile, the market is closely watching the upcoming speech by Federal Reserve Chairman Jerome Powell (to be delivered at the Jackson Hole annual meeting). Bond market investors are almost certain that the Fed will cut rates by 25 basis points in September and will lower rates again before the end of the year.
Investors are eager to see whether Powell will confirm the market's &#34;pricing expectation&#34;—that a rate cut is indeed forthcoming, or whether he will remind the market that new data may emerge before the next policy meeting, which could alter the Fed's judgment. Additionally, the market seeks more clues from Powell's speech regarding the rate cut path before 2026.
Herald van Der Linde, head of equity strategy for Asia-Pacific at HSBC, stated: &#34;If we receive some signals indicating that the Fed is more inclined to cut rates, it will provide further support to the market.&#34; In other words, if Powell hints at future rate cuts in his speech, investor confidence will strengthen, and the stock market may rebound.
U.S. President Trump again criticized Fed Chairman Powell on the social platform Truth Social: &#34;There are no signs of inflation at all, and all indications point to a significant rate cut. Powell's refusal to cut rates is hurting the real estate industry.&#34;
In terms of geopolitics, Trump is also actively promoting a ceasefire in the Russia-Ukraine war. He calls on Russian President Putin and Ukrainian President Zelensky to show some &#34;flexibility&#34; and encourages the two to hold a bilateral summit as soon as possible to push for an end to the war. This indicates that Trump is accelerating his intervention in the Russia-Ukraine conflict, hoping to facilitate peace negotiations between the two sides

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The Nasdaq 100 futures fell more than 0.5%. Tech stocks continued to decline after hours, with NVIDIA down 0.3%, Intel down 1.2%, and Palantir down 2.7%. This marks the fifth consecutive day of decline for the stock, the longest losing streak since March. Nevertheless, Palantir remains the best-performing stock in the S&P 500 index this year, having risen over 108% year-to-date

- Global stock markets paused their upward trend, primarily due to significant sell-offs in technology stocks, which had previously led market gains.  
- On August 20, S&P 500 futures fell over 0.2%, with declines across European and Asian markets, while the U.S. 10-year Treasury yield rose to 4.32%.  
- Investors are closely watching Fed Chair Powell's upcoming speech for potential signals regarding a September interest rate cut, amid concerns of overvaluation in tech stocks.

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Technology stocks dragged down global stock markets, with U.S. stock futures and most European stocks declining, the dollar rising for three consecutive days, and spot gold and crude oil prices increasing