After the release of non-farm data for the week of July 1-5, the US stock and bond markets rose and the US dollar came under pressure. Upon realizing the 'data detail' that the data in the first two months before non-farm was cut by 0.11 million, US bonds sharply rebounded and the yield curve became steeper.

Investors hold optimistic expectations for the prospect of a rate cut by the Federal Reserve. The CME FedWatch Tool shows that the likelihood of a 25 basis points rate cut in September has increased from 66.5% to 71.1%. The likelihood of the first rate cut in November has also increased, while the probability of the second rate cut in December has risen to 46.5%. Investors have fully anticipated that the Federal Reserve will cut interest rates twice before the end of the year.

This week saw rises in the three major U.S. broad-based indices, with the S&P 500, Nasdaq and Nasdaq 100 all closing at new highs. The PHLX semiconductor index saw its price-earnings ratio increase to 55.6, leading to further elevated valuations. At present, the S&P 500's Schiller P/E ratio has risen rapidly to 36.25, significantly higher than the historical average of 17.13 and the median of 15.98, and has more than doubled the average and median. The high valuation of the U.S. stock market means that it is still vulnerable to volatility in the near future.

Due to the upcoming second round of French parliamentary elections, uncertainty and changes in French economic policy may pose challenges to the market. Furthermore, this week's British House of Commons election results have had a certain impact on the European markets on Friday. Given Europe's comparatively weak economy, policy uncertainty, and lack of obvious valuation advantages in the European market at present, it is important to closely monitor these changes.

The Nikkei 225 index continued its rebound this week. However, the pressure on the yen exchange rate has not yet been resolved, and Japan's monetary policy is trending towards further tightening. As the timing of the Federal Reserve's interest rate cut still needs further confirmation, overseas emerging market indices such as Mexico's MXX, Brazil's IBOVESPA, India's SENSEX30, Indonesia's composite index, and MSC Vietnam, which have seen significant gains in the earlier period, are still waiting for a more clear signal from the Federal Reserve. We should closely monitor Powell's important speech next week and U.S. inflation data.

This week, the euro rose by 1.29% against the dollar, while the pound rose by 1.46% against the dollar. Offshore RMB rose as much as 150 points or 0.2% against the dollar in pre-market trading, rising briefly above 7.28 yuan, but the gain was mostly wiped out during regular trading hours and returned to the 7.29 yuan mark, still not far from the eight-month low. The dollar fell below the 161 level against the yen.

In terms of bulk commodities, the US employment report boosting expectations of a rate cut reduced the opportunity cost of holding non-interest-bearing gold assets, and the dollar came under pressure, supporting higher metal prices. Industrial metals in London rose across the board. International crude oil fell sharply, but a larger-than-expected drop in oil inventories indicated that oil demand would rise, and oil prices continued to rise for the fourth consecutive week.