On January 7th, a Tuesday, the major stock indices in the United States experienced a notable downturn, with the Nasdaq Composite falling by 1.89% and the S&P 500 dropping by 1.11%. The market faced a particularly tough day, reflecting investors' concerns over the recent strong economic data that was perceived as unfavorable for potential interest rate cuts by the Federal Reserve.

One of the central features influencing this decline was the employment statisticsThe latest figures revealed an unexpected increase of 259,000 job openings in November, bringing the total to a six-month high of 8.098 millionThis surge was well above the predictions of analysts, indicating that American companies continue to expand their hiring effortsSuch robust employment data suggests a persistent resilience in the job market.

Furthermore, manufacturing activity showcased positive trends as illustrated by the December ISM Non-Manufacturing PMI, which rose to 54.1 from 52.1 in November

Additionally, the prices index soared to 64.4, marking an eleven-month peakSince the service sector accounts for nearly 70% of the U.SGDP, its ongoing expansion signals that the fundamental momentum of the American economy remains strong.

However, this strong economic backdrop suggests that inflationary pressures in the U.Sremain robust, leading the market to focus more on interest rates rather than the potential for recessionAfter the data was disclosed, market participants began to heighten their expectations that the Federal Reserve would not lower rates in January, increasing to a probability of 95%. Furthermore, analysts predict that in 2025, the Fed will cut rates by less than 50 basis points, which led U.STreasury yields to approach an eight-month high, placing even more pressure on risk assets and leading to the swift decline of U.Sstocks.

Against this backdrop, the CES, widely known as the "Super Bowl of Tech," kicked off on January 7th in Las Vegas

• Exchanging Convenience for More Liquidity
• Major Stock Index Drops 45% Before Crucial Fed Update
• Enhancing the Role of Radiative Influence
• Stock Research Faces Challenges
• 10-Year U.S. Treasury Yields Surpass 4.7%

This event generated significant excitement among investors, predominantly due to Nvidia's new product launches and updates from major tech companies regarding advancements in the artificial intelligence (AI) sector.

Nvidia's founder and CEO, Jensen Huang, showcased a range of innovations, including generative AI, autonomous vehicles, and industrial digitalization technologiesHis presentation aimed to reassert Nvidia's dominant position in the GPU market, highlighting the strategic importance of these technologies to the AI supply chainDespite their long-term significance, Nvidia's stock, having reached historic highs prior to the event, met with selling pressure as the new announcements failed to deliver any immediate catalysts for growth on Tuesday evening.

In regard to the tech sector, Tianhong Fund remains optimistic, projecting that AI will continue to propel the performance of major technology firms, such as Google, Microsoft, Apple, Nvidia, and TSMC, throughout 2025. They also emphasize that Tesla is poised for significant advancements in AI-driven autonomous driving technology by 2025, while companies like Amazon will not only benefit from AI enhancements but also thrive amidst a strong U.S

consumer services sectorThus, the fund maintains a bullish outlook on the future trajectory of the U.Stechnology market.

Looking ahead to 2025, there are three fundamental assumptions regarding investments in U.SequitiesFirst, the U.Seconomy is expected to maintain its resilience, with corporate profits likely to demonstrate solid growthThe projected GDP growth rate for 2025 is approximately 2.5%, and the unemployment rate is anticipated to remain at healthy levelsThe strong balance sheets of American households combined with a low unemployment rate should sustain robust support for the consumer services sector, making a recession a low-probability event.

Second, the introduction of AI applications is likely to accelerate, suggesting continued industry momentumHistorical trends indicate that the development of AI technology could span at least another 5 to 10 years, establishing it as a critical long-term theme in the investment landscape.

Lastly, the implementation of 2.0 policies is expected to increase short-term volatility in the overall market

The core of U.Spolicy remains "America First," which, in this context, supports a stronger dollar and persistent inflation, potentially impacting the Fed's rate-cutting timeline.

After experiencing two consecutive years of substantial gains, the market's outlook for U.Sstocks has shifted towards a more rational and neutral perspectiveGiven the relatively high valuations, major institutions forecast the S&P 500's growth at around 10%, primarily driven by Earnings Per Share (EPS) growthThe uncertainties for the upcoming year arise mainly from policy developmentsNonetheless, the mid-term view remains unchanged, as the macroeconomic environment still favors global risk assets, primarily due to the likelihood of a soft landing for the U.Seconomy and the Fed being in a cutting cycle.

For long-term investors in U.Sstocks, Tianhong's Nasdaq 100 Index Fund and Tianhong S&P 500 Index Fund are both aligned with the broader U.S