Iran's Three-Stage Solution; DeepSeek Price Cut; ZTE Q1 Profit Down 46%

Iran Proposes Three-Phase Negotiation Plan

Overview of the Proposal

Iran has communicated a three-phase negotiation plan to the U.S. through intermediaries. The first phase focuses on completely ending the war and securing guarantees against renewed conflicts involving Iran and Lebanon. If an agreement is reached in this phase, discussions will move to the second phase, which will address the management of the Strait of Hormuz. The third phase will involve discussions on nuclear issues, but Iran insists it will not engage in nuclear negotiations until the first two phases are resolved.

U.S. Response

On Saturday, President Trump halted a special envoy's trip to Pakistan for talks with Iran, stating that if Iran wants to negotiate, they should just make a call, asserting that Iran has "no cards to play." In a Fox News interview, Trump expressed confidence that the war with Iran would soon end with a U.S. victory.

JPMorgan on Middle East Negotiations

Market Insights

JPMorgan's global market strategy team, led by Rajiv Batra, noted that while the Middle East situation remains unresolved, the path to a negotiated solution is clearer. The macro focus has shifted from risk premiums to residual "stagflation" risks. This shift is expected to lead to sharper differentiation in the stock market, with funds favoring less economically sensitive sectors that can sustain growth, particularly in AI and "security/resilience" investments.

DeepSeek Price Reduction Announcement

DeepSeek has announced a significant price reduction for its entire model series, with input cache prices dropping to one-tenth of the original price. The deepseek-v4-pro model is now available at a limited-time discount of 75%. This reduction is expected to enhance the adoption of complex intelligent applications.

U.S. Department of Justice Ends Investigation into the Federal Reserve

The U.S. Department of Justice has concluded its investigation into the Federal Reserve's office renovation project, potentially paving the way for the Senate's approval of Kevin Warsh as the next Fed Chair. The investigation was focused on cost overruns funded by taxpayers.

U.S. Space Force Contracts

The U.S. Space Force has awarded contracts worth up to $3.2 billion to 12 companies, including SpaceX and Northrop Grumman, for the development of a space-based missile defense system as part of the "Iron Dome" initiative.

Major Tech Earnings Reports

Upcoming Earnings

Four major tech companies—Google, Microsoft, Meta, and Amazon—are set to report earnings, with a combined capital expenditure nearing $600 billion. Investors are looking for signs of accelerated cloud revenue and sustainable profit margins.

Market Performance

Last Friday, the S&P 500 and Nasdaq indices reached record highs, with Nvidia's market cap surpassing $500 billion. Nvidia's stock rose by 4.32%, while Amazon, Microsoft, and Meta also saw gains.

Google to Invest in Anthropic

Google is reportedly planning to invest up to $40 billion in Anthropic, strengthening their partnership. This investment aims to enhance Anthropic's computational capabilities, particularly in AI programming.

Semiconductor Market Concerns

Michael Burry has announced a short position in the semiconductor sector, citing a lack of fundamental support for the current price surge. The Philadelphia Semiconductor Index has seen an unprecedented 18-day rally.

Apple’s New CEO Announcement

Apple's new CEO, John Ternus, will officially take over on September 1, with plans to launch the first foldable iPhone, focusing on durability and innovative technology.

Eli Lilly's Weight Loss Drug Performance

Eli Lilly's new oral weight loss drug, Foundayo, has had a slow start compared to its competitor, Novo Nordisk's Wegovy, highlighting the challenges it faces in the market.

Nuclear Energy Stock Surge

X-Energy's IPO saw a 27% increase on its first day, driven by strong demand for AI-powered energy solutions. Amazon is a major stakeholder, having committed to significant orders.

Hong Kong Stock Market Activity

Recent trading saw significant net purchases in Hong Kong stocks, particularly in China National Offshore Oil Corporation, while the Tracker Fund of Hong Kong faced substantial net sales.

Company Earnings Reports

Jin Feng Technology

Jin Feng Technology reported a 60% increase in net profit for Q1 2026, driven by increased sales of wind turbines and components.

ZTE Corporation

ZTE Corporation experienced a 46.58% decline in net profit for Q1 2026, attributed to exchange rate losses and reduced net interest income.

Chifeng Gold

Chifeng Gold reported a 104% increase in net profit for Q1 2026, benefiting from a significant rise in gold prices.

Upcoming Earnings Announcements

Several companies, including WuXi AppTec, Domino's Pizza, and others, are expected to release their earnings reports soon.