20:30 drops, another drop at 01:00—everything suddenly went quiet

—The drop isn’t that big, but what’s truly worth worrying about is that people have started to believe again that “the market can adjust.” Once sentiment shifts, it often moves faster than prices themselves.

Global markets once again played out the scene of “the US dollar rising, and everything falling”:

- US stocks fell across the board, with the Nasdaq index down 1.47%;

- Gold was the most representative asset last night. It dropped in the 20:30 move, dropped again at 01:00, and ultimately fell below the $4,000 round-number level;

- Oil prices edged lower. US crude slipped slightly below $80, driven by profit-taking;

- The US Dollar Index held its upward momentum and ended two straight days of decline.

First, on the surface, Thursday wasn’t particularly bad, and the US stock market didn’t fall all that much. The issue is that the index is being dragged down by this year’s most core storyline—semiconductors and AI hardware. As long as this main trend keeps falling, even if the index looks stable, market sentiment will remain fragile. The significance of yesterday’s decline was that people no longer believe US stocks only go up and never go down, and some people think the market may be about to enter a new round of adjustment.

Second, economic data didn’t give the market a comfortable answer either. Retail sales weren’t weak, initial jobless claims came in below expectations, and the Philadelphia Fed survey rebounded sharply—along with price indicators rising as well. While a July rate hike has been ruled out, a September hike is still hanging in the air.

Third, oil prices are another unstable factor. US crude surged intraday to nearly $81, then fell back to below $79. This shows that $80 is still an effective dividing line. If oil prices manage to regain and hold above $80, inflation and interest-rate pressure will return.

Fourth, the real risk on Friday is “not daring to hold positions before the weekend.” The conflict in the Middle East hasn’t ended, the US attacks on Iran are still ongoing, and risks in the Strait of Hormuz and the Red Sea are both present. As Friday moves into the late session, some funds may reduce their weekend risk exposure. If oil prices push up late in the session and bargain-for-safe-haven buying returns, the US stock market could face pressure. So Friday’s likely path is: an attempt to repair during the day, and watching weekend risk at the close.