After a sharp and unexpected market downturn, all eyes are on Nvidia’s upcoming earnings report, which could potentially revive the markets and push them back toward all-time highs. With a staggering $3.4 trillion valuation, Nvidia stands as the most valuable company in the world. Its earnings performance is poised to significantly impact market sentiment, particularly as investors ride the wave of enthusiasm around the AI trade—and more recently, the "Trump trade."
Adding to the high-stakes week are earnings reports from major retailers like Walmart and Target. The past three monthly retail sales reports have delivered mixed signals, leaving uncertainty about the broader retail landscape. While insights into their past quarter performance are anticipated, the focus will likely shift to their holiday season projections. Some retailers have already disclosed lower import volumes in response to anticipated weaker holiday demand. This week’s earnings will provide concrete numbers, shedding light on both the state of consumer spending and economic resilience. Consumer spending, after all, accounts for roughly a third of U.S. GDP, making these results a critical economic indicator.
Volatility Ahead?
With Nvidia and key retail earnings on the docket, the markets could experience a wild ride. The volatility index (VIX) climbed at the close of last week, signaling heightened turbulence as we head into this pivotal week.
SPY Technical Analysis
Last week’s broad market pullback brought SPY back to a crucial support range of 583.00–585.00. This level served as significant resistance throughout October before being decisively broken following the Trump election rally. If SPY falls below this range, it could trigger a wave of selling, pushing prices toward the next key support at 575.00. The events of this week will be instrumental in determining whether the markets can recover or continue their downward trajectory.