To The Moon

NVIDIA (NVDA) Takes Center Stage as Earnings Season Wraps Up Amid Global Market Turmoil

GuruFocus News 

1 day ago

$NVIDIA Corp(NVDA)$  ▼3.26%

As earnings season draws to a close, NVIDIA (NVDA, Financial) commands attention, with its financial results set to be a major focus. Meanwhile, Chinese companies NIO, XPeng, Trip.com, and Baidu will also release their earnings reports. Last week, markets were volatile globally with the U.S. October Consumer Price Index (CPI) showing a slight uptick, lowering expectations of a Federal Reserve rate cut. The U.S. stock market faced a downturn, with the Dow Jones down 1.16%, NASDAQ declining 3.43%, and the S&P 500 dropping 1.99%. European indices also struggled, with the FTSE 100 down 3.00%, Germany's DAX 30 slipping 1.14%, and France's CAC 40 falling 2.97%.

This week, the market's focus includes the November Purchasing Managers' Index (PMI) from major economies in Europe and the U.S., which could impact the rate cut outlook for the Federal Reserve and the European Central Bank. Canada's and Japan's latest CPI data are also in the spotlight. The U.S. "Trump trades" remain highly active, affecting forex market dynamics. As earnings season concludes, NVIDIA's results are eagerly anticipated.

The G20 summit in Rio de Janeiro revolves around themes of global inequality and sustainable development, discussing potential global governance reforms. In the U.S., inflation risks persist with recent CPI data indicating sticky price pressures. Federal Reserve Chair Jerome Powell suggests there is no urgency to cut rates, echoed by federal fund futures pricing, predicting at least one hold in the next two meetings. This week, further economic indicators including November's PMI data for the U.S. manufacturing and service sectors will be unveiled, potentially providing insights into the economy's trajectory.

In the commodities market, international oil prices weakened as the dollar strengthened and demand concerns prevailed. WTI crude fell 4.77% to $67.02 per barrel, while Brent crude dropped 3.83% to $71.04 per barrel. The International Energy Agency (IEA) predicts a supply surplus exceeding one million barrels per day in the upcoming year. Saudi Arabia's dissatisfaction with countries exceeding oil production quotas, like Iraq and the UAE, raises the risk of a price war. Investors continue to weigh the implications of U.S. President Trump's policies on domestic oil production and Iranian sanctions.

Gold prices declined sharply with changes in Fed rate cut expectations affecting market sentiment. COMEX gold futures dropped 4.53% to $2565.70 per ounce. The U.S. dollar index surged, increasing the cost of holding gold, while U.S. Treasury yields continued to rise. Traders are assessing potential medium-term uncertainties that could impact gold.

In Europe, better-than-expected GDP data from Q3 and a rebound in October CPI inflation reduced the likelihood of the European Central Bank cutting rates by 50 basis points at the next meeting. However, high-frequency data indicates stagnant economic activity across the eurozone. Key upcoming data includes the preliminary PMIs for November from the eurozone, Germany, and France. Additionally, the eurozone trade balance for September and final CPI data for October will be released.

In the UK, inflation data will be announced soon, with prior CPI figures dropping to 1.7%. Despite a recent rate cut, the Bank of England remains cautious about further easing measures due to persistent core inflation pressures. Retail sales data for October, due shortly, will also be significant as it offers insight into retail spending momentum in the current quarter.