JPM US Market Intelligence Morning Briefing Aug 11

IDEAS & INSIGHTS – IN BRIEF • MKT THOUGHTS – • DELTA-ONE FLOWS & POSITIONING – Bram tells us that Semis sold despite strong QQQ/NDX demand; HC & Discretionary see inflows; IEF-to-TLT rotation; Managed Money/CTAs buy Commodities • US MKT INTEL: CPI SCENARIO ANALYSIS – Feroli sees Headline MoM printing +0.12% and Core MoM printing +0.22%. This equates to 3.4% YoY for Headline and 2.5% YoY for Core. • US MKT INTEL VIEW – We update the Bull / Bear debate and are Tactically Bullish and we update the Monetization Menu

JPM MARKET INTEL MORNING UPDATES • SPX +0.0%, NDX +0.1%, RTY -0.1%. WTI +237bps at $84.08, NatGas -82bps to $2.77, UK NatGas +69bps to £1.5075, Gold -46bps to $4,371, Silver -139bps to $64.83, 10Y @ 4.725%, and VIX @ 15.51. • US: Futures are flat as bond yield are 1-2bp with the curve bear steepening; today sets up as a quiet session into tmrw’s CPI print which takes on heightened importance with the recent rebound in oil. There is a 3Y bond auction today which Jay Barry thinks may need extra concessions to digest, further pressuring yields higher as well as elevated credit issuance. USD is a touch higher as is USD/JPY. Cmdtys are higher led by Ags and Energy catalyzed by reduced expectations of a SoH deal; Base Metals are leading Precious. In Eqys, Semis / Memory names are leading the Tech tape with Mag7 names mixed. Most sectors are mixed, without a directional tilt, with Materials standing out for its weakness. Today’s macro data focus is on the 3Y Treasury auction, Small Biz Survey, and Existing home sales. • EU/UK: Major markets are mostly lower ex-Spain / SX5E. Regional yields are higher as curves bear steepen. Energy and Semis are leading the D1 leaderboard with Gold / Ceasefire plays lagging; Short baskets performing as intended. Thematically, MidEast Escalation / Recession are leading with Beta / Cyclicals / ST Momentum lagging; Growth over Value. This follows a mixed APAC session where

bearish macro data pushed China / HK to underperformance, and the Japan, Korea / TW were bright spots. UKX -0.2%, SX5E +0.0%, SXXP -0.1%, DAX -0.2%. CSI -0.8%, HSI -1.1%, NKY +2.1%, ASX +0.2%, KOSPI +0.7%.

CATALYSTS TODAY (WEEK AHEAD) • US MACRO DATA: NFIB Small Business Optimism at 6am ET. ADP Weekly Employment Change at 8.15am ET. Existing Home Sales at 10am ET. • US EARNINGS: CAVA, CRWV, EROC, IMXI, KPTI, LEGN, LITE, NN, QNT, SMCI, USAR, VG • GLOBAL MACRO DATA: (Japan) Money Stock M2 and Money Stock M3 at 7:50pm ET.

JPM MARKET INTEL EQUITY & MACRO NARRATIVE Yesterday was a quiet day with a dearth of catalysts and seemingly a lack of conviction going into CPI / Retail Sales prints this week.

• FX – USD/JPY gained 87bp yesterday, its largest gain since Mar 23. Recent interventions have not had a long lasting impact on the FX. More fundamentally, Meera removed her bullish call following NFP and now sees USD tracking near-term Fed expectations. • MACRO DATA – today’s focus is on (i) NFIB Small Business Optimism – the Hiring Index is an important leading indicator for NFP and has been moving higher recently and we will track to see biggest cost issues which have been mostly energy, tariffs, and shifting policy; (ii) ADP Weekly Employment – given the softness in last week’s NFP any upside surprise will be welcomed; (iii) Existing Homes Sales – Feroli sees the print reflecting a decline of 1% MoM to 4.05mm units.

SMALL BIZ HIRING SUB-INDEX vs. NFP