TradingKey - Affected by stronger-than-expected US August non-farm payrolls data, major US stock indices fell as market expectations grew that the Federal Reserve might raise interest rates at its next policy meeting. Semiconductor stocks bucked the trend to strengthen, with memory and optical communications stocks leading the gains.

At the close, the Dow Jones Industrial Average fell 0.51% to 53,414.25; the Nasdaq Composite Index dropped 0.29% to 26,506.99; and the S&P 500 Index fell 0.38% to 7,718.60.

Tech Stock Performance

Tesla (TSLA) fell 5.92% to $354.08.

This came as the company's highly anticipated Cybercab robotaxi update failed to meet Wall Street expectations, raising investor concerns over its ability to compete with Waymo in the U.S. robotaxi market. Tesla held the Cybercab event in Austin, Texas on Thursday, which was invite-only, not livestreamed, and not attended by CEO Elon Musk. The company stated that users can experience the Cybercab driverless service within a limited area in Austin via the Tesla Robotaxi ride-hailing app. An analyst at RBC Capital Markets noted that Tesla disclosed limited new information at the event, leaving key issues such as pricing, production cadence, and regulatory approvals unresolved.

Among major tech stocks, Meta Platforms (META) rose 1.00%, Nvidia (NVDA) gained 0.84%, and Broadcom (AVGO) advanced 0.21%. On the downside, Tesla (TSLA) fell 5.92%, Apple (AAPL) slipped 2.51%, Microsoft (MSFT) dropped 2.04%, SpaceX (SPCX) fell 1.20%, Google (GOOGL) dropped 1.11%, and Amazon (AMZN) dipped 0.15%.

[Source: FutuBull]

The Philadelphia Semiconductor Index rose 3.37% to 11,735.26 points, with all 30 constituents advancing. Among them, KLA (KLAC) surged 7.32%, Marvell Technology (MRVL) climbed 7.05%, AMD (AMD) gained 4.69%, Intel (INTC) rose 4.51%, Applied Materials (AMAT) advanced 4.31%, and ASML (ASML) added 4.17%.

Among memory stocks, SanDisk (SNDK) jumped 11.90%, SK Hynix (SKHY) rose 8.14%, Seagate Technology (STX) climbed 6.34%, Micron Technology (MU) gained 6.10%, and Western Digital (WDC) advanced 5.86%.

Company News

Micron Expected to Double HBM Capacity by Year-End

According to Yonhap News Agency citing industry insiders on the 4th, Micron plans to increase its monthly HBM capacity to approximately 100,000 wafers by the end of this year, nearly doubling from last year. By then, its capacity gap with Samsung Electronics and SK Hynix is expected to narrow to about half of the current level. Meanwhile, the company is accelerating the production ramp-up of its latest-generation 12-layer HBM4 products to meet demand for Nvidia's next-generation AI accelerators.

Samsung Partners with Arm to Develop 2nm Custom On-Device AI Chips

Arm reportedly approved non-recurring engineering (NRE) fees for a next-generation on-device AI system-on-chip (SoC) in late August and officially launched the project with Samsung Electronics. Under their division of labor, Arm is responsible for providing design technologies such as AI accelerator (AIC) architecture and RTL, communicating end-customer requirements, and coordinating project development. Samsung Electronics' System LSI Business will handle SoC design, while its Foundry Business plans to manage mass production using an advanced 2nm process.

Foldable iPhone Daily Output Reportedly Only 'A Few Hundred' Units, Facing Potential Supply Shortages at Launch

According to Nikkei Asia, citing sources familiar with the supply chain, constrained by Apple's stringent quality control standards, daily output of the foldable iPhone currently stands at only "a few hundred" units, far below the tens of thousands per day required for large-scale commercial shipments. Apple and its suppliers are making all-out efforts to ramp up capacity, but if output cannot be significantly increased in the short term, the model will face severe channel inventory shortages when officially launched.

Industry & Macro News

Trump Escalates Pressure on Fed to Cut Rates

U.S. President Donald Trump again pressured the Federal Reserve on Friday to cut interest rates sharply, threatening to sever trade with countries that run a trade deficit with the U.S. if the central bank fails to do so. Posting on social media in response to August jobs data that far exceeded expectations, Trump urged the Fed and Chair Kevin Warsh to "get smart" and cut rates immediately.

U.S. Drafts Post-War Middle East Plan to Contain Iran and Promote Israel-Saudi Normalization

According to Axios, the Trump administration is drafting a post-Iran war Middle East strategy focused on establishing a regional cooperation mechanism to contain Iran and expanding the normalization of relations between Israel and neighboring countries. Two U.S. officials and two people familiar with the matter revealed that the plan remains in its early stages and is intended to guide Middle East policy during the final two years of Trump's term. Sources said Trump recently held two meetings with senior advisors to discuss the plan, indicating in private conversations that he is pushing for "something bigger" after the war with Iran ends. The White House declined to comment. People familiar with the matter said the strategy could comprise three main pillars: creating a U.S.-backed regional alliance among allies to contain Iran; advancing the next phase of Trump's Gaza plan to help end the regional fallout from the Oct. 7 attacks, while implementing the Israel-Lebanon agreement and securing an Israel-Syria security deal; and expanding the Abraham Accords to drive the normalization of relations between Saudi Arabia and Israel. The report noted that U.S. officials hope the new government formed after Israel's Oct. 27 election will cooperate with the strategy, though some officials said Trump still plans to push forward with the proposal regardless of the election outcome. The plan is expected to take several more weeks to complete.

Citi: Strong August Nonfarm Payrolls Report Pushes Back Fed Rate Cut Expectations to Next June

Citigroup on Friday pushed back its forecast for the Federal Reserve's next rate cut from October 2026 to June 2027, citing stronger-than-expected August nonfarm payroll growth and overall stability in the labor market. The brokerage previously predicted the Fed would deliver 25-basis-point rate cuts in October 2026, December 2026, and January 2027, but now expects 25-basis-point cuts in June, September, and December 2027.

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