JPM International Market Intelligence | Morning Briefing

20 SECONDS: Busy week. Let the Bond Market Speak. Semis bears look smart. De- rating reflects uncertainty, not earnings, & rotations look a bit forced. How JPM sees the humanoid era.

• Another quiet session. The 'Economic D-Day' announcement was a non-event ( Oil -3%, limited move in odds SoH normalizes) but we still have a busy a week ahead of us.

• Rates and Debasement remain key themes with reports that US Treasury may use its General Account at the Fed (TGA) to expand bond buybacks.

• Ultimately, the underlying fundamental issues are real. A good way to see this = the UST safety premium vs close substitutes — AAA corporates and G10 sovereigns — has eroded (Charts below).

• Unless buybacks are paired with fiscal adjustment, Jay expects term premium to move higher. Of note, Stanley Druckenmiller makes a similar point in the WSJ (see “Let the Bond Market Speak”).

• We continue to express the debasement trade via Gold & Miners. UKX is also a good way to play this.

• Memory/Semis remained under pressure ahead of NVDA & MRLV (see previews). For AI Bottlenecks, earnings aren’t slowing – neither are the leading indicators such as cost of renting GPUs, US/China AI Capex, DRAM/NAND prices, Token volumes etc. - but AI bottlenecks have de-rated as competition and financing created more uncertainty (and positioning was very crowded).

• Hence, the bears sounded smart & persuasive (Chart below) while forced rotations continued alongside a challenging August for HF performance.

• Our view has broadening and dispersion across Tech but we recognize the opportunity to add to Bottlenecks.

• JPM remains in the bull camp on humanoids: early deployments should create a learning flywheel, while stranded capex risk is structurally lower. Early US demand should outstrip supply, with humanoids gaining share in less structured workflows where edge cases matter. Industrial adoption should lead on clearer ROI, with consumer uptake later as BOM declines. Key bottlenecks remain brain/data, hands, and supply-chain readiness.