Investors are on Nvidia’s mind as an eventful summer draws to a close. According to Bank of America, the big market catalyst to close out this month of interest will be the artificial intelligence (AI) chipmaker’s earnings results next week, not Fed Chairman Powell’s speech at Jackson Hole. Nvidia’s earnings are due next week on Wednesday, August 28, and Powell’s speech on Friday, August 23. One reason is that it will be hard for Powell to be more dovish than a market that is already pricing in a possible one percentage point cut in interest rates in 2024. In June, the Fed predicted just one quarter-percentage point cut for the rest of the year. Stocks rose on Monday, in part on optimism that Powell would signal that a rate cut was imminent. But the S&P 500 historically has not made big moves around the Jackson Hole symposium. The Jackson Hole Symposium brings together central bankers and economists to debate the major economic issues of the day. At the median, the broad index has risen 0.80 percentage points on a weekly basis since 2010. “With the rate cut already priced into the market, even a dovish speech at Jackson Hole is likely to limit upside as the market awaits NVDA’s earnings release next week for better indications from the state on economic growth,” Orson Kwon, equity and quantitative strategist at the firm, wrote on Sunday. NVDA 1 million mountains NVIDIA NVIDIA’s earnings release should be the next big catalyst for the AI pioneer and the market as a whole, especially as investors focus on growth over inflation. “Growth is leading the charge. It’s unlikely the Fed will ‘outbounce’ the market at Jackson Hole, but stocks can withstand a less-than-dovish Fed if growth is OK,” Kwon wrote. “Stocks just need acknowledgement that growth will be supported by the Fed.” “Risks could be on the upside, but the magnitude may be contained heading into NVDA’s earnings release next week,” Kwon added. Nvidia shares may be up more than 150% this year, but they’ve disappointing this month, rising just 5% following the tech stock selloff earlier this month. But investors have been redeploying into the stock since then and remain optimistic about the stock’s long-term prospects. As of Friday’s close, Nvidia is up more than 37% from its intraday low on Aug. 5. JPMorgan noted that retail investors, in particular, are buying into the dip. Nvidia shares rose 2% on Monday.
Nvidia earnings will be big catalyst in late summer: Bank of America
By NvidiaDaily
