Sudden major negative news

The U.S. has gone completely unhinged in its sanctions—going so far as to sanction even Huaiyang Foods, a company that makes sunflower seeds. As a U.S. client, you must always be prepared for the risk of forced liquidation. In recent years, the optical module sector’s situation most closely resembles that of the CXO sector back then. In 2021, the CXO sector was the hottest investment theme—many leading companies surged over tenfold from their lows. The biotech innovation sector was thriving, and Chinese CXO firms held globally leading competitiveness. Yet once U.S. sanctions hit, WuXi AppTec became the vanguard target of short-selling, and the entire CXO sector plunged continuously for three years—down more than 70%. This time, the U.S. has again targeted optical modules—the flagship sector of AI hardware technology. I simply don’t believe this is anything other than financial warfare... For ordinary retail investors, it’s wise to steer clear of such arenas where great powers clash. Let institutions, industrial capital, and major shareholders bear the brunt—after all, they’re more capable, wealthier, and earn more. -------- 1. U.S. Treasury Secretary Bessent stated that an agreement regarding the Strait of Hormuz may be reached within the next two days. Upon this news, international oil prices plunged sharply—down 6% (from +2.5% to -3.5%). So indeed, this is good news. A drop in oil prices benefits many sectors: economic recovery, growth stocks—including technology, innovative pharmaceuticals, domestic consumption, aviation & airports, tourism, and internet companies. It only hurts energy-related sectors: oil, coal, and new energy. Of course, market movements are determined by multiple factors; the performance of specific sectors and individual stocks remains primarily governed by their own internal dynamics. 2. WuXi AppTec reported better-than-expected earnings: H1 revenue reached RMB 28.897 billion, up 38.94% year-on-year; net profit totaled RMB 11.08 billion, up 29.43% year-on-year. WuXi AppTec also fully upgraded its 2026 guidance: projected full-year revenue raised from RMB 51.3–53.0 billion to RMB 58.5–60.5 billion, with growth revised upward from 18%–22% to 35%–39%. Adjusted free cash flow for 2026 is now forecast at RMB 13.5–14.5 billion, up from RMB 10.5–11.5 billion. As a result, WuXi AppTec’s A-share stock hit the daily limit-up, lifting the entire CXO sector and innovative pharma stocks—now just 15% below their all-time high set in 2021. WuXi AppTec has truly endured—withstanding U.S. sanctions head-on. Its core strength lies in genuinely world-leading technology and cost advantages, making it indispensable to U.S. biopharma firms. It remains to be seen whether leading optical module firms can replicate WuXi AppTec’s story: falling nearly 80%, then rebounding steadily via robust earnings growth to approach their July 2021 all-time highs.

Why did tech stocks suddenly lose momentum in July? What JPMorgan saw wasn’t fundamentals—but the withdrawal of the most aggressive capital.

Originally published on WeChat Official Account: "Master Code". Word count: 2,264; estimated reading time: ~12 minutes. Why did tech stocks suddenly lose momentum in July? JPMorgan saw not fundamentals—but the withdrawal of the most aggressive capital. Over the past few months, the market’s dominant theme has been crystal clear: AI demand remains strong; tech leaders continue delivering solid earnings; and the most leveraged investors have persistently pushed semiconductor and broader tech stocks higher. The new development this July, however, is that the tech correction is no longer just a routine pullback after extended gains—it reflects a historic deleveraging event among TMT-focused hedge funds and multi-strategy funds. Citing preliminary data from Pivotal Path, JPMorgan notes that TMT-sector funds lost 10.2% in July, while multi-strategy funds lost 2.3%. If subsequent data confirms these figures, it signals a decisive shift in marginal pricing power for tech stocks—from institutional leveraged capital toward more emotionally driven retail investors. Going forward, the key variable to watch won’t be “who still believes in AI,” but rather: who remains willing and able to step in as buyers—and how. Many interpret this round of tech volatility as “fundamentals unchanged, markets panicking unnecessarily.” JPMorgan’s report offers a more grounded perspective: the root issue lies first in funding structure—not industry logic. What had the market been trading? This tech rally, fundamentally, reflected the convergence of three drivers: First, the AI narrative continued strengthening—with semiconductors, memory chips, and compute infrastructure representing the clearest profit pathways. Second, institutions were willing to leverage up—especially TMT-focused hedge funds and multi-strategy funds, which could concentrate positions and amplify trends using derivatives. Third, retail investors further fueled the fire via options, leveraged ETFs, and margin accounts—creating a classic “strong fundamentals + momentum-driven capital + amplified volatility” structure. This means tech stocks weren’t rising merely because they were “good companies”—but because “good companies” were overlaid with sustained, extreme crowding by the most aggressive capital. So long as that crowding persisted, gains easily outpaced fundamentals; once that structure began fraying, corrections accelerated markedly beyond those typical for other sectors. What new constraint has emerged? The new constraint is that the very capital best equipped to absorb volatility—and most skilled at amplifying trends—buckled first in July. Citing preliminary performance data from Pivotal Path, JPMorgan reports that TMT-sector hedge funds posted a 10.24% drawdown in July—a figure excluding losses from Situational Awareness, whose AUM reportedly fell from $45 billion to $10 billion. Multi-strategy funds posted a 2.27% drawdown—their fourth-worst monthly loss on record. By contrast, equity long/short funds were nearly flat, and macro funds even posted modest gains—indicating this isn’t a broad-based hedge fund collapse, but rather a forced unwinding of excessively crowded tech positions. This represents the report’s most critical conceptual shift: the constraint facing tech stocks has evolved—not just “Can the AI story continue?” but now also “Do the most adept tech traders retain the same capacity to hold positions?” Just how large is this shift in scale?

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Calumet Specialty Products Partners stock surged over 10% following a Q2 revenue beat of $1.45 billion, aided by debt reduction and the Montana Renewables MaxSAF project. Goldman Sachs raised its price target to $40 amidst cautious optimism.

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Calumet, Inc. Reports Q2 Revenue $1.45 Billion, Surpassing Estimates

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Calumet Inc. Reports Q2 2026 Revenue of $1.45B, EPS ($1.09)