Goldman Sachs reviewed NVIDIA's earnings performance and provided commentary on Dell and Snowflake's results in its September 4 Market Insights, while also raising US second-quarter economic data. Regarding the Chinese market, Goldman Sachs stated that Chinese stocks still have room for upward movement and correspondingly raised target levels. Goldman Sachs maintains its "overweight" recommendation for Chinese offshore stocks (Hong Kong stocks and American Depositary Receipts) and A-shares, expecting the MSCI China Index to rise 10% within 12 months to a target of 90 points, and the CSI 300 Index to increase 12% within 12 months to a target of 4900 points.

**US Market Highlights**

**Large Tech Companies and Non-traditional Customers Continue to Support NVIDIA**

Following NVIDIA's earnings call, Jim believes that despite performance and guidance meeting expectations, the company still has considerable growth potential heading into 2026. On the positive side, the Rubin series products have entered early production stages, with gradual shipments expected to begin by mid-2026. Additionally, the customer base has become more diversified, particularly with the addition of sovereign fund clients whose order demands have reached $20 billion, doubling from a year ago.

However, NVIDIA's business prospects in the Chinese market remain unclear, with uncertainties surrounding market demand for H20 series products and whether future Blackwell series products can obtain export licenses.

In the short term, Jim noted that strong sales performance of Hopper series products and robust resilience in non-data center business offset the impact of slower-than-expected growth in Blackwell series shipments. Looking ahead to next year, demand from large tech companies and non-traditional customers will continue to support the company, with Goldman Sachs' earnings per share (EPS) expectations about 10% higher than market consensus.

Dell has also released its earnings report, with AI server business orders maintaining strong growth, but Infrastructure Solutions Group (ISG) business profit margins declined, leading to EBIT below expectations. Meanwhile, both storage business and Client Solutions Group (CSG) business performance fell short of expectations.

Compared to hardware manufacturers, US software companies delivered more impressive performance. Snowflake's results showed the company continues to deepen its "moat" in data and AI platforms, with strong second-quarter performance and revenue growth exceeding 30%. The company also achieved record growth in million-dollar paying customers, giving Kash more confidence in the company's future revenue scale breaking through $10 billion.

Next, investors will focus on US core inflation data, retail sales data, and other macroeconomic indicators to track US economic performance and assess the likelihood and magnitude of Federal Reserve rate cuts in September.

Goldman Sachs' US macroeconomic research team has raised the US second-quarter real GDP quarter-over-quarter annualized rate to 3.3%, while raising US domestic final sales growth rate to 1.9%. Additionally, Goldman Sachs expects July core Personal Consumption Expenditures (PCE) price index to rise 0.26% month-over-month, corresponding to a year-over-year increase of 2.87%.

US initial jobless claims declined slightly, meeting market expectations. Goldman Sachs maintains its previous baseline assumption that the Federal Reserve will cut rates by 25 basis points for the first time in September.

Additionally, one point worth noting from the Jackson Hole Global Central Bank Annual Meeting minutes: Since the 1950s, under the influence of global population aging, declining productivity, and increased external demand, market demand for US dollar assets has continued to rise, allowing US dollar interest rates to remain stable or even decline. Related model predictions show that even as the US debt-to-GDP ratio continues to climb, this trend of growing demand for US dollar assets will persist until 2100.

**Focus on Chinese Market**

**China Stock Strategy: Why Does the Liquidity-Driven Rally Still Have Room to Develop?**

After breaking through consolidation patterns during the height of summer, Chinese stocks have performed strongly over the past two weeks: Since August, A-share large-cap and small-cap stocks have risen 8% and 10% respectively; Hong Kong stocks have reached new year-to-date and even 4-year highs on 2 out of the past 5 trading days.

Despite macroeconomic statistics showing cyclical weakness signs and market consensus expectations for corporate profits gradually stabilizing, the rally has arrived as expected, raising investor concerns about the "sustainability of liquidity-driven rallies."

Goldman Sachs' strategy research team believes this liquidity-driven bull market still has room for further continuation. This judgment is based on several points:

First, current Chinese stock market valuation levels remain within historical median ranges (referring to MSCI China Index); Second, corporate profit growth rates maintain high single-digit levels (from semi-annual reports, many companies' performance exceeded expectations); Third, A-share market retail investor risk appetite remains near median levels (as seen from new account openings, current numbers are lower than last October and previous bull market periods); Finally, potential household savings "migration" and asset rebalancing processes will bring sustained net capital inflows to the stock market.

Based on these points, Goldman Sachs believes that despite recent market facing certain profit-taking pressure, the overall upward trend will continue.

Goldman Sachs maintains its "overweight" recommendation for Chinese offshore stocks (Hong Kong stocks and American Depositary Receipts) and A-shares, expecting the MSCI China Index to rise 10% within 12 months to a target of 90 points, and the CSI 300 Index to increase 12% within 12 months to a target of 4900 points.

The firm reiterates its preference for "alpha strategies" (achieving excess returns through stock or sector selection) to achieve better risk-return ratios.

Key risks to watch include: sudden tightening of market liquidity, regulatory policy shocks exceeding expectations, and macroeconomic policy effects falling short of expectations — historically, these factors often disrupt most liquidity-driven stock market rallies.

**Global Market Commentary**

**Asian Bond Investors Gradually Embarking on "De-dollarization" Path**

Over the past six months, Asian bond investors' focus has shifted significantly. At the end of last year, market attention was mainly concentrated on "US exceptionalism" (US economic performance significantly outperforming other major economies), but recent months of Goldman Sachs' communications with investors show that "de-dollarization" has become a noticeably more prominent theme.

Goldman Sachs expects Asian bond investors to adjust their fixed-income asset allocation at a gradual pace, while structural factors will support their sustained demand for foreign bond purchases.

On one hand, larger and more mature Asian economies have substantial current account surpluses; on the other hand, these economies generally face population aging issues. Combined, these two factors will drive further growth in these economies' demand for foreign fixed-income assets.

The "de-dollarization" trend did not begin in 2025; in recent years, insurance funds in Taiwan and Japan have been seeking to reduce their foreign bond purchase scale. However, these funds currently still hold substantial foreign bond positions, indicating that substitutes for US dollar fixed-income assets remain relatively insufficient.

Given that "US dollar weakness" is one of Goldman Sachs' foreign exchange research team's clearest views, Goldman Sachs expects Asian bond investors to continue expanding their investment scope and reducing dependence on US dollar assets. This trend will bring ample growth and development opportunities to Asian local currency bond markets, though in the foreseeable future, US dollar fixed-income assets may still remain one of the important asset classes for Asian bond investors.