To The Moon

Both Nvidia and Meta were rising early on Wednesday. The chip maker's hardware is powering the training of Meta Platforms' next
artificial-intelligence model.

⚠️ Trading tips: META is pending another breakout above 500 again. All eyes on Thursday’s PPI report to determine the move. Friday happens to be quad witching as well so be cautious of greater volatility ahead 😉

Waiting for a dip buy

Further signs of the seemingly insatiable demand for Nvidia's graphics-processing units were on show from Facebook- parent Meta Platforms, which gave details of two 24,576-GPU clusters it is using to train its next AI model, named Llama 3.

"These clusters support our current and next generation AI models, including Llama 3, the successor to Llama 2, our publicly released LLM [large language model], as well as AI research and development across GenAI and other areas," Meta engineers wrote in a blog on Tuesday.

Meta reiterated its intention to have 350,000 Nvidia H100 chips by the end of 2024. Notably, it also said it was using Nvidia's InfiniBand networking technology in one of the GPU clusters, pointing to another source of revenue for the chip maker.

Other chip makers were mixed early on Wednesday. Advanced Micro Devices was up 0.6% in premarket trading and Intel was down 1.2%.

Nvidia shares have risen 86% this year to date through to Tuesday's close. That compares with a 8.5% rise in the S&P 500 index and a 8.4% rise in the Nasdaq Composite Index over the same period.

10 mins trade to ride on both calls

The February Consumer Price Index (CPI) rose by 3.2% year-on-year, exceeding both the previous and expected 3.1% surge. Additionally, the core CPI index, which strips out volatile food and energy items, surprised to the upside at 3.8%, compared to the expected 3.7%.

Treasury yields moved higher, with the policy-sensitive two-year yield soaring by 6 basis points to 4.6% and the 10-year yield rising by 7 basis points to 4.17%.

Markets held firm on expectations for a June rate cut, envisioning a 70% chance, according to the CME Group FedWatch tool.

The Fed is set to hold its two-day policy meeting in a week, during which policymakers will unveil the new macroeconomic projections, revealing the preferred interest rate path.

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