After a night has passed, the world hears the alarm again.

Source: Global Market Report

The three alarms have only begun to flicker again; they have not all sounded simultaneously.

After a night, the warning bells have returned to the global markets:

- US stocks slipped slightly, with the Dow Jones Index down 0.85%, S&P 500 down 0.18%, and Nasdaq down 0.06%;

- Gold prices turned downward, but still held above $4,200;

- The US Dollar Index, US Treasury yields, and US crude oil all rebounded across the board.

First, a familiar dangerous combination has re-emerged—the US Dollar Index is probing the 100 level (closing at 99.79), the 10-year US Treasury yield testing 4.7% (closing at 4.67%), and US crude oil testing $80 (closing at $78.23). None of these markets have truly broken through the danger zone, but all three returned to the threshold on the same day.

Second, two pieces of news influenced market movements. First, a report from the Financial Times about Waller's conditional rate hikes halted market gains. Afterwards, Iran published a “Preliminary Hormuz Strait Management Plan” with very strict conditions, restricting US and Israeli ships, imposing transport limitations on certain countries, and possible penalties for violations. The market immediately realized the situation may not be so simple: oil prices moved higher (crude remains the first domino), while US stocks and gold prices turned downward.

Third, although the US stock market’s loss was modest, the implications are substantial.

· From the structure, the Nasdaq fell just 0.06%, appearing the strongest, but this may be deceptive. The relative resilience of large tech stocks masks broader weakness.

· The Dow Jones saw the biggest fall. The rotation from tech stocks to traditional industries was met with the pressure of rebounding oil prices and yields.

Fourth, there are two things to watch today. First, watch the response of Asian markets to the US stock decline—will they interpret Thursday’s movement as ordinary cooling off? In the evening, the outcome of the nonfarm payroll data will be crucial—America’s July employment report will be released at 20:30 Beijing time tonight. This time, we must look at more than just the headline new jobs; unemployment rate, average hourly earnings, and revisions to previous months all matter. Data that comes in on the strong side could quickly heighten rate hike expectations, but even weak data may not significantly relieve market nerves—crude oil has once again become the master switch for inflation.

On Thursday, the danger merely got closer; tonight, nonfarm payrolls will determine whether it turns away—or pushes through the door.