Market Beats | EU to Fast Track Industrial Tariff Removal to Meet US Demands; China Hedge Funds Boost Equity Bull Run; Struggling NYC College to Sell Campus to CUNY; US Companies Plan Record Stock Buybacks; $7 Billion Penn Station Overhaul to Begin by End-2027; China Aims to Triple AI Chip Output Next Year

—— EU to Fast Track Industrial Tariff Removal to Meet US Demands; China Hedge Funds Boost Equity Bull Run; Struggling NYC College to Sell Campus to CUNY; US Companies Plan Record Stock Buybacks; $7 Billion Penn Station Overhaul to Begin by End-2027; China Aims to Triple AI Chip Output Next Year

1. EU to Fast Track Industrial Tariff Removal to Meet US Demands

The European Union will move to fast track legislation by the end of the week to eliminate all tariffs on US industrial goods, a condition set by President Donald Trump before he will reduce duties on EU car exports.

According to people familiar with the matter, the European Commission will also grant preferential tariff rates on some seafood and agricultural goods. While the Commission concedes that the arrangement favors the US, it stressed the accord is necessary to provide stability and certainty for businesses. Commission President Ursula von der Leyen previously described it as “a strong, if not perfect deal.”

Currently, EU cars and auto parts face a 27.5% tariff when exported to the US. While a recent trade agreement lowers tariffs on nearly all European products to 15%, Trump insisted that cars would not be included unless legislation is proposed to remove industrial and other duties. If the EU introduces legislation by the end of the month, the 15% tariff rate on European cars will be backdated to Aug. 1.

Automobiles are among the bloc’s most significant exports to the US, with Germany alone exporting $34.9 billion worth of cars and parts in 2024. To speed things up, the Commission will skip its usual impact assessment procedure.

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2. China Hedge Funds Boost Equity Bull Run

China’s stock market rally is getting a fresh boost from domestic hedge funds, fueling optimism among local brokers that the liquidity-driven surge has further room to run.

An index tracking the equity positions of Chinese hedge funds managing over 10 billion yuan ($1.4 billion) jumped more than 8 percentage points to 82% in the week ended Aug. 15, according to Bloomberg calculations based on data from Shenzhen PaiPaiWang Investment & Management Co. That marks the biggest weekly gain in about two years. Separately, the number and combined size of newly registered hedge funds — most of which invest in equities — both climbed to the highest level this year in July, according to the Asset Management Association of China.

The growing presence of hedge funds, which require a minimum investment of 1 million yuan, indicates wealthy investors are piling into equities. This cohort tends to be more patient and tolerant of losses than retail traders, potentially adding momentum to the rally. “The rally has been primarily driven by funds from high net worth individuals, while inflows from household savings remained slow,” said Fu Zhifeng, chief investment officer at Shanghai Chengzhou Investment Management. He added that low yields on fixed-income products and relatively high stock returns are pushing risk-seeking investors toward equities.

China’s stock market, the world’s second largest, has surprised observers with a stunning rally in recent months, fueled by ample liquidity and bets on technology firms. The benchmark CSI 300 Index has climbed over 9% this month, ranking among the world’s best-performing major gauges, despite the economy still grappling with deflationary pressures and trade tensions.

Meanwhile, retail investors remain cautious. New account openings at the Shanghai Stock Exchange in July — a popular gauge of retail demand — stood at just about one-third of the peak seen in October.

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3. Struggling NYC College to Sell Campus to CUNY

A struggling New York City college plans to sell its Manhattan campus to the City University of New York (CUNY), offering relief for its bondholders.

According to a regulatory filing dated Aug. 26, CUNY intends to purchase the Financial District real estate from Metropolitan College of New York for $40 million.

Proceeds from the sale, after closing costs, will be used to redeem part of Metropolitan College’s outstanding bonds and pay deferred debt service. The college has about $60 million in outstanding debt, according to Bloomberg data. The bonds had been cut deep into junk territory by Fitch Ratings and were secured in part by a mortgage on condominium units at 40 Rector Street, as well as the college’s revenues. The college put the property up for sale last year under a forbearance agreement with investors. For small colleges, real estate is a valuable asset that can help investors recoup money in times of financial stress.

The letter of intent said CUNY wants to buy about 100,000 square feet in commercial condo units at the property, permitted for use as classrooms and offices “typical for a college, university or graduate school.”

A CUNY spokesperson said the units were identified as a temporary location for the Hunter-Bellevue School of Nursing, while construction continues on a new center that will bring three of its schools together into a single campus.

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4. US Companies Plan Record Stock Buybacks

US companies are planning share repurchases at a historic pace, underscoring Corporate America’s confidence in the economy.

Announced buybacks surpassed $1 trillion on Aug. 20 — the fastest time ever to reach that level, according to Birinyi Associates. The previous record was set in October last year.

In recent months, major corporations have unveiled massive repurchase programs. Apple Inc. announced a $100 billion buyback following its May earnings report. Alphabet Inc., JPMorgan Chase & Co., Goldman Sachs Group Inc., Wells Fargo & Co. and Bank of America Corp. each announced at least $40 billion. In July alone, announced buybacks totaled a record $166 billion, as the largest US financial and tech firms rolled out their plans.

Buybacks provide a key pillar of support for the US stock market, helping the S&P 500 return to all-time highs. A pipeline of announced programs points to rising confidence among corporate executives.

Analyst Rubin forecasts announced buybacks will reach $1.3 trillion this year, with completed repurchases also set to hit a record.

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5. $7 Billion Penn Station Overhaul to Begin by End-2027

The Trump administration announced that construction on the $7 billion overhaul of New York’s Pennsylvania Station will begin by the end of 2027.

“Crumbling infrastructure, bleak and dirty architecture, unnavigable hallways and no inviting spaces for families with kids – the current state of Penn Station is unacceptable,” Transportation Secretary Sean Duffy said in a statement Wednesday.

The administration moved to make Amtrak the lead agency for the project, effectively sidelining the Metropolitan Transportation Authority. Amtrak will receive nearly $43 million in federal funding to support project development, master developer solicitation, permitting, and preliminary engineering work.

Andy Byford, the former New York City Transit President — nicknamed “Train Daddy” — will head the redevelopment effort. He will launch the solicitation for a master developer on Aug. 28, with the final selection due by May 2026.

The revamp was first launched under former Governor Andrew Cuomo and later revised by Governor Kathy Hochul in 2021. It calls for a 250,000-square-foot, single-level transit hub with new amenities, retail stores, and mixed-income housing.

The announcement also highlights the administration’s broader push to take direct control of key Northeast Corridor rail hubs. Earlier Wednesday, Duffy said the government is also moving to reclaim management of Washington’s historic Union Station near the Capitol.

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6. China Aims to Triple AI Chip Output Next Year

China’s chipmakers are seeking to triple the nation’s total output of AI processors in 2026, as Beijing races against the US to advance artificial intelligence technology.

One fab dedicated to producing Huawei’s AI chips is set to begin production by the end of this year, with two more scheduled to launch next year, according to people familiar with the plans. While the plants are designed to support Huawei, their ownership remains unclear. Huawei denied it is building its own fabs and gave no further details.

Chinese firms are also working on next-generation AI chips compatible with standards promoted by startup DeepSeek, which has emerged as the country’s leading AI player. Huawei’s latest processors are believed to align with DeepSeek’s requirements.

Once fully operational, the combined capacity of the three new fabs could surpass the current total output of Semiconductor Manufacturing International Corporation (SMIC), China’s top contract chipmaker. SMIC itself plans to double its 7nm capacity next year — the most advanced mass-produced node in China — with Huawei as its largest customer.

As a result, smaller Chinese chip designers such as Cambricon, MetaX, and Biren will gain significantly larger allocations of SMIC’s capacity, fueling tougher competition in China’s fast-growing AI chip market after Nvidia was sidelined by US export bans.

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7. Apple to Unveil iPhone 17 Lineup at Sept. 9 Launch Event

Fourteen years after Marc Andreessen declared that “software is eating the world,” artificial intelligence has flipped the script — with investors betting that large parts of the software sector may now be the ones consumed.

Salesforce, Adobe and ServiceNow are among the worst S&P 500 performers this year, each down at least 17% and erasing a combined $160 billion in market value. According to EPFR data, software and services funds saw outflows in two consecutive months through June, compared with only one monthly pullback in the prior 18. A Morgan Stanley SaaS basket has fallen over 6% this year, while the Nasdaq 100 is up 11%. Companies like Asana, Hubspot, Bill Holdings and Vertex are among the hardest hit, each down more than 29%.

Investors see AI as an imminent threat to firms providing code for digital services like CRM and back-office functions. “Tech obsolescence can come out of nowhere,” said Robert Ruggirello, CIO at Brave Eagle Wealth Management. “There’s good reason people are growing cautious.”

Still, some software players are thriving. Microsoft, Oracle and Palantir are outperforming as they aggressively leverage AI.

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