HTX Research analyst Chloe analyzes interest rates and risk-asset performance over the next 1 weeks

AT A GLANCE

The article argues that the concentration of gains in U.S. equities and changes in ETF inflows show that risk assets remain affected by interest rates.

Article

HTX DeepThink: U.S. equity breadth is narrowing,ETF inflows are slowing, and the direction of risk assets still depends on interest rates

BlockBeats reports that September 29，HTX DeepThink columnist and HTX Research analyst Chloe said that the core issue over the next 7 days is whether the market can absorb higher funding costs. The Federal Reserve September 16 has raised rates by 25 basis points to 3.75%—4%, and this week's data will directly affect the magnitude and duration of subsequent rate hikes. The baseline view is that risk assets will trade weakly with continued internal divergence; for a sustained rebound to begin, the bond market needs to release pressure first.

The vulnerability of U.S. equities lies in the concentration of gains. As of September 25, the S&P 500 was less than 1%from its all-time high, while the equal-weighted index had already fallen about 4%for the month, indicating that most stocks are already under pressure from interest rates and that the index is primarily supported by a small number of technology heavyweights. If yields continue to rise, earnings expectations will need to improve further to offset valuation compression; even if the index rebounds, a failure of the equal-weighted index to recover in tandem would make it difficult to confirm a broad recovery in risk appetite.

Key tests include September 30 PCE、October 2 nonfarm payrolls, as well as the manufacturing and services October 1、5 released on the PMI. The most favorable combination would be cooling core inflation, moderate employment growth, and easing wage pressures; a sharp drop in employment could trigger earnings concerns. Of particular importance is whether long-term yields can fall after softer data. If short-term yields decline while long-term yields remain elevated, this would indicate that improved policy expectations are still insufficient to resolve long-term financing pressures, and the room for a technology-stock rebound would remain limited.

The crypto market is already supported by spot inflows, but incremental inflows are slowing. According to Farside data,September 21 to 25 U.S. spot BTC ETF has recorded cumulative net inflows of approximately 2386000000 USD, while daily inflows have declined from 999000000 USD to 135000000 USD day by day; the five-day change is still insufficient to confirm a trend reversal. If ETF inflows continue,USD and yields stabilize,BTC could prove more resilient than small-cap tokens; if inflows turn negative while derivatives open interest continues to expand, declines will be more easily amplified by liquidations. Over the next 7 days, U.S. equities will be assessed by the breadth of gains, while the crypto market will be assessed by spot absorption; the overall direction still depends on interest-rate movements.

Key points

HTX Research analyst Chloe believes that over the next 7 days, the market's core issue is whether it can absorb higher funding costs.
The article states that the Federal Reserve September 16 raised rates by 25 basis points to 3.75%—4%。
As of September 25, the S&P 500 was less than 1%from its all-time high, while the equal-weighted index fell about 4%。
September 21 to 25, U.S. spot BTC ETF recorded cumulative net inflows of approximately 2386000000 USD, while daily inflows declined from 999000000 USD to 135000000 USD。
The data points listed for observation in the article include September 30 PCE、October 1 manufacturing PMI、October 2 nonfarm payrolls and October 5 services PMI。

AI-assisted interpretation

The following is analysis, separate from reported facts. Verify important claims independently.

The core view of this article is that a small number of technology stocks are supporting the U.S. equity index, while most stocks are under pressure from interest rates; Bitcoin spot ETF continues to receive inflows, although the pace of inflows has slowed. The market's subsequent direction will also depend on how inflation, employment data, and long-term interest rates develop.

Why it matters to readers

If long-term yields continue to rise, equity valuations and financing pressures may remain under strain; if ETF inflows continue, the article believes that BTC may be more resilient than small-cap tokens.

For beginners, three signals are worth focusing on: whether gains are being driven jointly by most stocks,ETF whether it continues to attract funds, and whether long-term interest rates decline after economic data are released.

Risks and unknowns

The article's statements regarding choppy risk-asset performance, a sustained rebound, and BTC relative resilience are analysis and forecasts that have not yet been confirmed by subsequent market performance.
The future releases of PCE, nonfarm payrolls, and PMI data, and their effects on yields, are not yet known from the evidence.
The evidence does not state whether ETF the slowdown in inflows will continue, nor does it confirm whether derivatives open interest will continue to expand.

HTX Research analyst Chloe analyzes interest rates and risk-asset performance over the next 1 weeks

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