Nvidia in Focus: US Stock Markets Slightly Down

U.S. stock markets recorded slight declines on Wednesday as market participants eagerly awaited the upcoming Nvidia earnings report. All three benchmark indices showed slight losses, while Nvidia shares rose by 1%. Expectations for the chip manufacturer Nvidia are high. Investors are hoping for another set of outstanding quarterly results and concrete indications of how the massive investments in Artificial Intelligence (AI) are paying off for the company's clients. The forthcoming results might trigger significant market fluctuations. On Tuesday, Goldman Sachs pointed out that based on this week's options pricing, the report could prompt a price movement of up to $300 billion for Nvidia. The stock is already trading near its record highs, posing the risk that even minor deviations from expectations could lead to significant price declines. "All eyes in equities are now on Nvidia's earnings release this evening, which has triggered major price movements in recent quarters," Deutsche Bank strategists wrote on Wednesday morning. "Keep in mind that Nvidia's stock has already risen by +159% year to date, making it the top performer in the entire S&P 500, and it has increased by more than +1000% since its low in October 2022." Additionally, traders are focusing on the upcoming comments from the President of the Federal Reserve Bank of Atlanta, Raphael Bostic, who will speak after the market close. His remarks could provide further insights into the Fed's rate cut trajectory for this year. According to the CME FedWatch Tool, investors are expecting rate cuts of up to 150 basis points by the end of the year.