What's driving today's markets?
As anticipated, Wall Street's opening was a mixed bag, echoing the fluctuating futures. Shares in the real sector and banks are down, whereas technology and semiconductor manufacturers' stocks are enjoying a healthy boost. The primary catalyst for this tech growth was Nvidia's earnings report, released after yesterday's market close.
What's happening with NVIDIA?
Despite a decline in revenue and net profit by 13% and 20% respectively, the reported figures significantly outpaced analysts' predictions. Furthermore, the company announced impressive sales for Q2 2023 that surprised even the most bullish investors. Pre-market NVIDIA shares surged by 24%, and since the opening bell, the growth has topped 25%. A little more momentum, and Nvidia will join the $1 trillion club.
In my view, this is a fascinating story that highlights the 135% increase in NVIDIA's share price over the past year, which ha largely been attributed to the booming popularity of AI.
However, I believe this growth alone won't suffice to propel the market further. Given the challenging economic conditions, I see a high probability of a market correction on the horizon.
Let's also consider some statistical data. U.S. GDP figures surpassed expectations, yet with the unresolved debt ceiling issue, this news has taken a back seat and will likely resonate later. And as for the initial U.S. jobless claims? No change there either, meaning there’s yet more to keep an eye on in the future.
What raises concern is that the DXY is standing at 104.21 points, and the ten-year UST yield is at 3.77% per annum, with the two-year yield at an alarming 4.42%! Meanwhile, gold is trending downwards. All in all, quite an intriguing scenario.
[link] [comments] https://www.reddit.com/r/stocks/comments/13rjtn7/nvidias_impressive_report_not_the_markets_silver/
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