NAS100 Drops on Nvidia Slump & Weak PMIs Ahead of Crucial NFPs
NAS100 Analysis
Nvidia continued its post-earnings drops shedding more than 9% on Tuesday, in one of its worst days, falling back to correction territory (more than 20% down from its record peak). Despite strong results, soft guidance and slower rollout of its next-gen AI platform failed to assuage broader AI concerns.
Adding to the woes, the US Justice Department has sent subpoenas to Nvidia according to Bloomberg [1], as it investigates potential antitrust violations. At the same time, factory activity contracted to the lowest levels of the year, reigniting fears of a recession.
These developments weighed on the NAS100, which shed more than 3% yesterday and is now again on the verge of correction and vulnerable the 200Days EMA (blue line).
On the other hand, the weak PMIs strengthen the case for more decisive pivot by the Fed, and market pricing for a larger 50 basis point cut went up. CME's FedWatch Tool assigns 43% probability on such outcome, although a 25 bps move remains more likely. [2]
These expectations along with oversold conditions indicated by the RSI, could help NAS100 regain the initiative above the EMA200 (black line) and push for higher highs (19,951).
The next leg of the move will be determined by the high-stakes employment report on Friday, which is now more important for the Fed policy path, as disinflation is back on track. Another soft report would bolster calls for a larger cut by the central bank and help Wall Street, but upside surprise would dispel market optimism.
Nikos Tzabouras
Senior Financial Editorial Writer
Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. With extensive experience in market analysis and a strong foundation in international relations, he brings a unique perspective to financial markets. Nikos emphasizes not only technical analysis but also on fundamentals and the growing influence of geopolitics on financial trends.
As a Senior Financial Editorial Writer, he delivers comprehensive and forward-looking insights across a wide range of asset classes, including equities, commodities, and currencies. His work explores how macroeconomic events, political developments, and global policies impact market dynamics, providing readers with a deeper understanding of both short-term movements and long-term trends.
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