As retail investors look ahead to the US market, all eyes are on Nvidia Corporation (NASDAQ:NVDA), the chipmaking giant that has driven this year’s impressive stock market rally. Investors are eagerly anticipating Nvidia’s earnings report to see if the company can continue its extraordinary run, especially after its recent gains.
Nvidia’s performance this year has been remarkable, with its stock soaring over 150% year-to-date. Our research is looking for another strong quarter from Nvidia, as recent commentary from hyperscale customers and results from supply chain partners point to continued strength in AI infrastructure builds. (Read more in Nvidia Corporation | CGSI – Raymond James | Aug 20, 2024)
However, Nvidia isn’t the only company under the microscope this week. Major players like Salesforce Inc (NYSE:CRM), BHP Group Ltd (NYSE:BHP), Dell Technologies Inc (NYSE:DELL), CrowdStrike Holdings (NASDAQ:CRWD), Autodesk Inc (NASDAQ:ADSK), and Lululemon Athletica Inc (NASDAQ:LULU) are also set to release their earnings, providing insights into various sectors.
As earnings reports roll in, investors are also closely watching key economic data ahead of the Federal Reserve’s (Fed) next move. The advance estimate showed the US economy expanded at an annualized rate of 2.8% in the second quarter (Q2), a significant acceleration from first quarter’s (Q1) 1.4% growth and well above initial forecasts. This week will bring the second estimate of the Q2 GDP growth rate.
The Core Personal Consumption Expenditures (PCE) Price Index, the Fed’s preferred measure of inflation, rose by 0.2% in June, with a year-on-year increase of 2.6%. This week, the July figures will be published. Markets are already pricing in a rate cut at the September meeting, with most expecting a 25-basis point reduction. However, there’s still debate about whether a more substantial 50-basis point cut might be necessary. July’s personal income and spending data will provide additional clues. In June, personal income rose by 0.2%, while spending increased by 0.3%.
Other key data to watch include July’s Durable Goods Orders, whereby consensus forecast suggests a 4% improvement, following a 6.6% month-on-month slump in June, also the Conference Board Consumer Confidence for August.
In summary, Nvidia’s results could either reinforce the market’s bullish sentiment or introduce a new wave of caution if the company fails to meet the high expectations set by its recent performance. Meanwhile, the Fed’s potential rate cut looms large, with investors looking for any signs of how aggressive the central bank might be in easing policy.
Disclaimer: ProsperUs Manager of Content Hailey Chung doesn’t own shares of any mentioned companies.
