To The Moon

The S&P 500 and NASDAQ reversed earlier losses to close 0.16% higher, while the Dow Jones Industrial Average rose fractionally at 0.02% to finish at a record high for the second straight day. The indexes traded within narrow ranges all day. Russell 2000 close -0.7%. Volume was below average due to light participation ahead of Labor Day. There was a lack of market-moving news and strong buying interest before NVIDIA's (NVDA) earnings report, contributing to muted market action.

The big event for markets this week comes after the closing bell Wednesday, when Nvidia will release its quarterly results, amid expectations that the AI chipmaker will once again blow past Wall Street estimates. The stock gained 1.46% today, recovering most of the previous session's decline, as market participants prepare for what is widely regarded as the most critical earnings report of the quarter.

Other tech stock like Apple (AAPL) was up by +0.37% traded higher after naming Kevan Parekh as its new CFO. Eli Lilly (LLY) gained +0.42% on its announcement of a Zepbound savings program for non-covered patients.

Information Technology Back At Top With Mega Cap Tech Stocks Gain

Mega-cap stocks turned in a mixed performance on Tuesday, with Apple (AAPL) and Microsoft (MSFT) rising slightly while Alphabet (GOOGL), Meta Platforms (META) and Amazon (AMZN) lost ground. This has helped Information Technology sector to gain +0.63% leading the S&P 500 sector.

Only 6 out of 11 sectors finished in the green with shorter range from +001% to +0.63%. Financials and Real Estate finished second and third with +0.49% and +0.25% respectively.

Energy was the worst-performing sector losing -0.93%amid falling oil prices. WTI crude oil futures slid 2.3% to $75.61/bbl.

PHLX Semiconductor Index (SOX) Was Up +11% Despite Week Loss

Despite the week’s loss at 1.4%, $Philadelphia Semiconductor Index(SOX)$ manage to finish higher with +1.1%. We also saw Vanguard Mega Cap Growth ETF (MGK) finished +0.3% higher despite down 0.3% since last Friday.

Bond Market

Following a $69 billion 2-yr note auction, which met solid demand, we saw 2-year note yield gain 4 basis point to 3.867%.

The yield on 10-year note, which is sensitive to expectations around interest rates, was down by 8 basis point to 3.823%.

Consumer Confidence Index Improved

The Consumer Confidence Index in August improved from an upwardly revised 101.9 in July to 103.5. This suggest that consumers are showing more concern about the labor market conditions, which could lead to lower consumer spending.

We will be expecting the MBA Mortgage Applications Index at am ET and the EIA Crude Oil Inventories at 10.30am ET.

Stocks To Watch

As investors eagerly await $NVIDIA Corp(NVDA)$ quarterly report this week, the tech giant's financial performance is under intense scrutiny. Wedbush analyst Dan Ives emphasized that Nvidia's numbers mark the most crucial week of the year for markets. Nvidia has been a significant driver of the bull run in U.S. stocks, and its upcoming earnings will be pivotal in justifying its massive valuation.

Following my previous article, Is Nvidia (NVDA) Blackwell Delay A Concern For Its Earnings?

I am still seeing strong interest in NVDA prior to its earnings, though we might not expect significant earnings like previous quarter, we need to understand that with the increase demand for AI-enabled PCs and servers from manufacturer like Dell and HP Inc, we could still see order for NVDA GPUs growing.

MACD is still showing a potential upside for NVDA, and from the MTF (Multi-time frame) we are still seeing NVDA trending upwards.

$SUPER MICRO COMPUTER INC(SMCI)$ shares quickly fell 2.8% following a new short report from Hindenburg Research. The short seller, known for its high-profile calls on companies like Nikola (NKLA) and Lordstown Motors (RIDE), targeted Super Micro, which has already seen its shares nearly double this year. Super Micro is also scheduled to present at the Deutsche Bank 2024 Technology Conference on Wednesday.

LIke I have shared previous in the NVDA article, it look like SMCI will suffer a downward movement following this short report.

Meta (META) CEO Mark Zuckerberg revealed that the company faced pressure from Biden administration officials to censor COVID-19 content. Zuckerberg expressed regret for not pushing back against these demands and emphasized that Meta would not compromise its content standards due to governmental pressure in the future.

Investor attention will be on cannabis-related stocks as the DEA scheduled a public hearing to discuss the U.S. Justice Department's proposal to reclassify marijuana as a less dangerous drug. Canadian Licensed Producers like Canopy Growth (CGC), $Tilray Inc.(TLRY)$ , Aurora Cannabis (ACB), and SNDL Inc. (SNDL) are already trading lower in the premarket.

I am holding Tilray so this would be of focus as this would be a new milestone if cannabis is classified as less dangerous drug and used for medical purpose.

$Trip.com Group Limited(TCOM)$ shares surged 9% following its Q2 results, which showed a 14% Y/Y increase in revenue and improved adjusted EBITDA margins. The company's domestic and international businesses demonstrated consistent growth, with outbound hotel and air reservations recovering to pre-COVID levels.

If we were to look at TCOM for the short term, there is still potential for upside as seen from MACD, and from the multi-time frame, we could be seeing some volatility in the price following its earning results.

But that might be an opportunity to buy into this stock.

Summary

Market participants are closely scrutinizing economic indicators for signs of how aggressive the Fed might be as it starts cutting its benchmark interest rate. Fed Chair Jerome Powell said last Friday that the "time has come for policy to adjust," reinforcing expectations that the central bank will start easing rates at its September policy meeting.

What would be important today or rather this week is Nvidia earnings, this should give us an idea on how the AI demand or revolution have progressed. Will we be able to see Nvidia giving impressive earnings like before?

Appreciate if you could share your thoughts in the comment section whether you think market will experience volatility or muted action awaiting Nvidia earnings?

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.