$NVDA up next
Macro Perspectives
The interest rate market is now telling us that central banks in the U.S., Eurozone, UK, Canada, Australia and New Zealand are all done with rate hikes. In all cases but Australia, markets are betting on close to 100 basis points of cuts next year.
As we head toward the end of the year, we have a government shutdown averted in the U.S. alongside a Republican-led House with an appetite to curtail the Biden administration spending binge.
All of the above bode well for stocks into the year end. For perspective, the broader market (equal-weighted S&P 500) has just in the past two days moved back into positive territory for the year (up just over 2%).
That said, we have another inflation report next month and another Fed meeting.
But at this point, the biggest news into the end of the year will be, not the Fed, but Nvidia earnings - they will report next Tuesday.
It was just six months ago that Nvidia's CEO shocked the world, declaring "the beginning of a major technology era." Founder/CEO Jensen Huang told us there was a "rebirth of the computer industry" underway, where "AI has reinvented computing from the ground up." He said the launch of ChatGPT (last November) was the defining "moment" for the industry.Â
He had the numbers to back it up - they grew revenues by 19% from Q4 to Q1, by 88% from Q1 to Q2 and have guided for a $16 billion quarter, or 18% quarterly revenue growth.
That's 170% year-over-year revenue growth for a company doing well north of $40 billion in annual revenue.
