Recent changes in U.S. economic data have sparked a reconsideration of the future direction of monetary policy in the market. After the release of the Consumer Price Index in July (CPI), there was a noticeable shift in U.S. stock market styles, prompting investors to recall previous expectations of a potential interest rate cut in July 2024. However, the Producer Price Index released on August 14 for July (PPI) significantly exceeded expectations, causing some impact on interest rate cut expectations.

In this context, the upcoming Jackson Hole global central bank annual meeting has become the focus of market attention. If Federal Reserve Chairman Powell sends dovish signals at the meeting, or even hints at a possible rate cut in September, then the trading narrative around rate cuts in the U.S. stock market is likely to become clearer.

It is worth noting that if interest rate cut expectations heat up again, we may see a market reaction similar to that during the interest rate cut expectation period in July of this year. At that time, sectors sensitive to interest rate changes performed well, such as the Russell 2000 index, the real estate sector within the S&P 500 index, and the Nasdaq biotechnology sector all saw significant increases.

However, investors should remain cautious and closely monitor the upcoming Jackson Hole meeting, as well as changes in future U.S. economic data. These factors will continue to influence market expectations regarding the Federal Reserve's policy path, which in turn will affect the performance of various assets.