By Konstantinos Chrysikos, Head of Customer Relationship Management at Kudotrade
U.S. equity futures were relatively stable amid mixed reactions to Nvidia’s earnings. Nevertheless, the company provided a relatively supportive undertone and saw its shares extend some gains in pre-market trading. The chipmaker delivered better-than-expected results and projected current-quarter revenue above consensus, citing continued robust spending by major technology firms on AI infrastructure.
Management emphasized that generative AI represents a structural shift in computing demand and signaled that, despite supply constraints at TSMC, Nvidia was able to secure the components needed to meet demand. However, gaming margins may face temporary pressure from component tightness. Still, uncertainties persist. No H200 AI chips have yet been sold to Chinese customers despite conditional US approval, highlighting the impact of US-China trade tensions.
At the same time, the market could also react to geopolitical developments and changing monetary policy expectations. The outcome of talks between Washington and Tehran could prove pivotal for near-term risk appetite, while new economic data could influence interest rate cut expectations and could affect the direction of the market.