Stocks rise globally on hopes of peace talks with Iran—but the Fed may deliver a shock on Wednesday

Good morning. On Fortune’s radar today:

China’s AI labs are matching U.S. ones—and beating them on price.

Maybe, maybe: The Fed could raise rates on Wednesday.

Iran: Peace talks are back on.

Tech jobs decline in countries where AI presence is increased.

College-educated women are marrying less-educated men.

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China’s AI labs are challenging American ones—and beating them on cost

In mid-July, online sleuths who obsessively track the internet for signs of new AI models started to whisper about the latest offering from Moonshot AI, the Beijing-based artificial intelligence startup behind the Kimi large language model: Something big was coming. Moonshot AI’s latest model didn’t just live up to the hype—it raised the stakes, Fortune’s Nicholas Gordon reports.

On July 16, Moonshot debuted Kimi K3, the largest open-source model ever released, and promised it could perform close to the level of Anthropic’s Fable 5—perhaps the most powerful publicly available model on the market today—at a fraction of the cost.

Kimi K3 blew up the timeline: Chinese AI is now cheap enough and good enough that even U.S. startups and Fortune 500 companies are quietly plugging the models into their operations to rein in spiraling AI budgets. It’s a remarkable closing of the gap that China achieved despite Washington imposing export controls to choke off China’s access to the world’s most advanced chips.

Stocks are up as Chinese chipmaker CXMT sets new market cap record

S&P 500 futures were up 0.95% this morning. The index rose 0.05% in its last session. 

In Europe, the Stoxx 600 was up 0.68% in early trading, and the U.K.’s FTSE 100 was up 0.44% before lunch.

Asia: South Korea’s KOSPI was up 0.97%. Japan’s Nikkei 225 was up 0.5%. India’s Nifty 50 was up 1%. China’s CSI 300 was up 1.15%. 

Brent crude was $89 per barrel this morning, down from a high over $100 last week.

Shares in chipmaker CXMT soared on their stock market debut in China today, closing up 465.82% and—at $484 billion—briefly making the company the largest by market cap in China. CXMT competes with Micron, SK Hynix, and Samsung, and is a supplier to Apple.

As stocks climb ever higher, bullish sentiment declines. This chart from Bespoke Investment Group shows........

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