Dow Jones and Nasdaq 100 Eye Breakout Potential Amid China Margin Concerns and Trump Headlines

China’s Services PMI and Market Impact

• China’s Services PMI rose to 53 in August, up from 52.6 in July.

• The increase came from stronger new orders, the fastest since May 2024.

• Despite the growth, companies cut jobs to reduce costs.

• This raised concerns about weak consumer demand and Beijing’s 5% GDP growth target.

• China’s Manufacturing PMI also improved, rising from 49.5 in July to 50.5 in August.

• Even with better PMI numbers, inflation and employment worries hurt investor confidence.

Asian Market Performance

• The Hang Seng Index dropped 0.22% to 25,439 after hitting a high of 25,790.

• The CSI 300 fell 0.33% and the Shanghai Composite dropped 0.62%.

• Japan’s Nikkei 225 lost 0.29% to 42,187, despite a weaker Yen.

• The ASX 200 declined 1.18%.

• USD/JPY rose 0.36% to 148.889.

• Normally, a weaker Yen helps Japanese exports and corporate profits.

China Summit and Trump’s Reaction

• The China Summit was held with India, Russia, and other countries attending.

• Beijing aimed to build stronger ties with nations hit by US policy.

• President Trump criticized the event, posting on X:
  “Please give my warmest regards to Vladimir Putin and Kim Jong Un, as you conspire against the United States of America.”

• His comments raised fears of renewed US-China and US-India trade tensions.

• Market sentiment weakened as investors worried about Trump’s unpredictability.

US Market Outlook

• US stock futures showed mixed results.

  • Nasdaq 100 E-mini rose 53 points.

  • S&P 500 E-mini gained 6 points.

  • Dow Jones E-mini fell 120 points.

• Investors were cautious ahead of US labor market data.

• Economists expect the Fed to cut rates in September, but policy for Q4 remains uncertain.

• This week’s Jobs Report could decide if the Fed cuts rates again or pauses.

Labor Market Data in Focus

• Today, JOLTs job openings will be released.

• Forecasts suggest openings fell from 7.437 million in June to 7.4 million in July.

• A bigger drop could signal a weaker labor market and increase expectations of more Fed cuts.

• A stronger reading could reduce bets on Q4 rate cuts.

• More data this week, including ADP jobs, jobless claims, ISM Services PMI, and the Jobs Report, will guide markets.