Is Nvidia's Beat Enough to Save the Markets? 27/02/2025

HOT stories for today

US market wrap:
 

• On Wednesday, stocks pulled back from their session highs as concerns over President Donald Trump’s trade policies weighed on investor sentiment. The S&P 500 eked out a marginal 0.01% gain, ending its four-day losing streak. The Dow Jones Industrial Average dropped 188 points, or about 0.4%, while the Nasdaq Composite advanced nearly 0.3%.
• Markets remained volatile amid ongoing tariff discussions and mixed corporate earnings, with traders closely watching Nvidia’s results. However, despite a third straight earnings beat, the stock failed to gain momentum, leaving investors looking ahead to the next major catalyst—Friday’s inflation report. The S&P 500 heatmap showed only three of eleven sectors closing in positive territory, with technology leading the way at +1.09%, while consumer staples lagged, down 1.91%. Meanwhile, domestic metals and mining stocks gained traction following reports that Trump had instructed his administration to consider imposing tariffs on copper.

Nvidia Beats, But Doubts Linger
 

• Nvidia beats Wall Street expectations with strong fourth-quarter earnings, driven by AI demand, but warns of rising competition from Huawei. Revenue surged 78% to $39.33 billion, with full-year sales up 114% to $130.5 billion. The company projects $43 billion in first-quarter revenue, signaling continued growth but at a slower pace Data center sales, now 91% of Nvidia’s revenue, jumped 93% to $35.6 billion, fueled by strong demand for Blackwell AI chips. CEO Jensen Huang called demand “amazing,” while CFO Colette Kress highlighted its record-fast adoption.
• However, concerns remain over AI efficiency models like DeepSeek’s R1 and competition from custom AI chips by Amazon, Microsoft, and Google. Despite AI strength, networking sales fell 9%, and gaming revenue dropped 11% to $2.5 billion, missing forecasts. Automotive AI sales, a growing segment, doubled year-over-year to $570 million. Nvidia also spent $33.7 billion on stock buybacks in fiscal 2025, showing confidence in its long-term outlook. Shares were flat in extended trading as investors weighed future growth prospects.

 
Stocks on the move:       

• Snowflake (SNOW) — The cloud data analytics firm's stock jumped over 9% following a stronger-than-expected fourth-quarter earnings report. Snowflake posted adjusted earnings of 30 cents per share on revenue of $987 million.
• Salesforce (CRM) — Shares of the enterprise software giant edged up less than 1% after mixed fourth-quarter results. Salesforce reported adjusted earnings of $2.78 per share, surpassing analysts’ projections.
• Nutanix (NTNX) — The cloud computing company's stock surged 12% after delivering solid fiscal second-quarter results, reporting adjusted earnings of 56 cents per share on revenue of $655 million.
• C3.ai (AI) — Shares dipped about 2% despite the enterprise software company exceeding earnings expectations. C3.ai posted a loss of 12 cents per share on revenue of $99 million.
• Teladoc (TDOC) — The virtual healthcare provider’s stock slid 10% after reporting a larger-than-expected fourth-quarter loss of 28 cents per share, missing analysts’ estimates of a 24-cent loss per share, according to LSEG.

Today’s action

• Asia-Pacific markets were mixed Thursday after Wall Street gained despite renewed tariff threats from U.S. President Donald Trump. Japan’s Nikkei 225 traded near the flatline, while Seven & i Holdings fell over 10% after its founding family’s buyout attempt failed to secure financing. Hong Kong’s Hang Seng Index slipped 0.18%, and China’s CSI 300 dipped 0.2%.
• U.S. stock futures edged higher as investors analyzed Nvidia’s latest earnings. S&P 500 futures ticked up, Nasdaq 100 futures rose 0.28%, and Dow Jones Industrial Average futures gained 65 points, or 0.15%. Traders are watching Thursday’s jobless claims but are mainly focused on Friday’s personal consumption expenditures (PCE) price index, the Federal Reserve’s preferred inflation gauge. On the earnings front, Warner Bros. Discovery and Dell Technologies will report their quarterly results later today.

Wahtclist: SMCI, NVDA, TDOC, CRM, SNOW, AI, PARA, NTNX

Bitcoin
 

• Bitcoin’s decline deepened after hours of stability near $89,000, plunging below $84,000—its lowest level since November 11. The broader crypto market followed, with major altcoins like ETH and SOL posting losses, though LTC bucked the trend with a double-digit daily surge. Just last Friday, BTC was above $99,000, but a steady selloff pushed it below $90,000 by Tuesday. It briefly rebounded to $89,000 before another rejection sent it tumbling to $83,500 on Bitstamp.
• The drop is driven by Trump’s trade war escalation, inflation concerns, and record outflows from Bitcoin ETFs. Exchange deposits have surged, hinting at more losses ahead. BitMEX co-founder Arthur Hayes warned BTC could fall to $70,000, erasing post-election gains. Meanwhile, the crypto market remains in the red, with ETH, SOL, BNB, DOGE, XRP, ADA, and AVAX seeing steep declines. Hourly liquidations have hit $250 million, according to CoinGlass.
  Watchlist: Bitcoin: 83 000-109 500, Ethereum: 2000-3000, Solana: 150-276

Forex

• The Japanese yen weakens on Thursday as Japanese government bond (JGB) yields decline further. A rise in U.S. bond yields supports the dollar, keeping USD/JPY elevated. However, expectations that the Bank of Japan will continue raising interest rates help limit the yen’s downside. Despite BoJ Governor Kazuo Ueda's recent comments on increasing bond purchases, investors remain convinced of further rate hikes, boosting JGB yields and providing some support to the yen.
• EUR/USD slips to 1.0465 in Thursday’s Asian session, down 0.20%, as Trump's renewed threat of 25% tariffs on the European Union weighs on the euro. Traders are also pricing in two quarter-point rate cuts by the Federal Reserve. Investors now await the U.S. fourth-quarter GDP estimate and weekly jobless claims, set for release later in the day, for further market direction.
  Watchlist: EUR/USD: 1.0200-1.0550, USD/JPY: 149-158.80

Basic Materials

• Gold weakens as rising U.S. bond yields lift the dollar off multi-month lows. Uncertainty over Trump’s tariff plans and trade war fears may support gold, while expectations of Fed rate cuts could help limit losses. XAU/USD extends its decline below $2,900, hitting a one-week low. A modest rise in Treasury yields and improved risk sentiment are pressuring the precious metal as the dollar strengthens for a second day.
• WTI crude oil remains near a two-month low at $68.70 per barrel, weighed down by rising supply expectations and weakening demand. Hopes for a Russia-Ukraine peace deal and potential easing of Russian sanctions add to the bearish outlook. Meanwhile, Trump’s plan to revoke Chevron’s oil license in Venezuela fuels further uncertainty in energy markets.
  Watchlist: GOLD 2600-2945, US Oil: 68.00-79.00

Key Economic Events Today:

EST time

08:00 am: USD FOMC Member Barkin Speaks
08:30 am: USD Prelim GDP
08:30 am: USD Unemployment Claims
08:30 am: USD Durable Goods Orders
10:00 am: USD Pending Home Slaes
10:00 am: USD FOMC Member Barr Speaks
11:45 am: USD FOMC Member Bowman Speaks

Earnings

BMO (Before the US Market opens)

RY            Royal Bank of Canada
TD            Toronto Dominion Bank
VST          Vistra Corp.

AMC (After the US Market closes): DELL, ADSK, MNST

The TEFS Analyst team wishes you a successful day!