Traders were busy on the New York Stock Exchange as stock futures moved slightly on Monday night. Recent tech losses dragged down the market, leaving many investors curious about Nvidia’s upcoming earnings report and important jobs data due this week.
Futures for the Dow Jones rose by 52 points, or 0.1%, while S&P futures also saw a slight increase. The Nasdaq 100 futures went up by about 0.2%. However, the previous trading session saw all three major U.S. indexes close lower. The Dow Jones fell over 550 points, or 1.2%, and both the S&P 500 and Nasdaq Composite dropped by around 0.9%.
Nvidia’s stock dipped about 2% ahead of its quarterly earnings announcement on Wednesday. The company has been a focal point in discussions about the current artificial intelligence market. Concerns are rising over tech valuations and the quality of AI investments, especially with an increase in debts from major tech firms and the depreciation of AI chips.
The Nasdaq is likely to end its seven-month winning streak. In November, the S&P 500 is down 2.5%, breaking a six-month run of gains.
Garrett Melson, a portfolio strategist at Natixis Investment Managers Solutions, noted that the market narrative has shifted sharply. There’s a growing skepticism about investments in AI compared to earlier optimism. Despite this, Melson is hopeful that a cooling job market and improved inflation will lead to a year-end rally. He believes Nvidia’s report might reaffirm confidence in the AI market.
This week, investors will keep an eye on data that can influence upcoming interest rate decisions. According to the CME FedWatch tool, there’s now about a 40% chance of a rate cut, a significant drop from over 90% a month ago. Key reports, including the Federal Reserve’s October meeting minutes and nonfarm payroll data, will be released on Wednesday and Thursday, respectively.
Additionally, results from big consumer names like Walmart, Home Depot, and Target will shed light on consumer spending as holiday shopping season approaches. Experts suggest that consumer behavior could significantly impact market trends, especially during this critical time.
In a nutshell, while the tech market faces challenges, there are still possibilities for recovery, driven by solid consumer spending and a gradual shift in economic conditions. Investors are navigating uncertain waters but remain cautiously optimistic.
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