Nasdaq is set for gains as Nvidia turns a corner

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U.S. stock futures were broadly steady on Tuesday with AI chipmaker Nvidia ( NVDA ) eyeing a cautious rebound from a three-day slide as investors trimmed their portfolios for the end of the quarter.

Futures on the Nasdaq 100 (NQ=F) rose roughly 0.5%, while those on the benchmark S&P 500 (ES=F) rose 0.2%. Dow Jones Industrial Average (YM=F) futures fell 0.1% after rising more than 200 points to start the week.

Stocks are looking brighter as the Nasdaq and S&P 500 took a bruise as Nvidia’s slide dented the tech boom that has fueled earnings this year. Investors are seen taking marked gains in AI-related names as a stellar quarter draws to a close, raising the question of whether recent losses should go further.

Shares of the artificial intelligence darling rose more than 2% in premarket trading, coming off a fall of more than 6% on Monday.

At the same time, the Dow appears to be finding its feet amid a shift from technology to value stocks, giving weight to the idea of ​​an expansion of earnings into other sectors.

Elsewhere, the wait is for Friday’s update on the Personal Consumption Expenditure (PCE) index, a favored input for inflation for the Federal Reserve. Governor Michelle Bowman indicated on Tuesday that she is prepared to raise interest rates if holding them steady fails to keep price pressures under control.

Meanwhile are the Case-Shiller report on April home prices and a reading on consumer confidence, closely watched by investors watching for cracks in previous resilience.

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  • A major market risk for 2025

    As if you need another money thing to worry about.

    In an exclusive interview with Yahoo Finance’s Jennifer Schonberger late Monday, US Treasury Secretary Janet Yellen reminded investors that Trump’s tax cuts will expire in 2025.

    I can’t think of the last investor I spoke to who expressed concern about the expiration and how it might affect the markets.

    But Yellen did her best job of bringing this back to light:

    “The signature policy from the Trump years was the Tax Cuts and Jobs Act, and it promised an investment boom that really didn’t materialize. It gave huge tax breaks to corporations and wealthy individuals. And it resulted in a greatly increased the deficit and reduced tax revenues below historical rates and I think is responsible for many of the problems we face now with our fiscal trajectory.

    How markets will react in 2025 if the tax cuts are not extended due to deficit concerns is, of course, extremely unknown today. However, it should not be ignored in the investment planning process. Just consider this: No extension of the tax cuts would mean the top tax rate would revert to 39.6% from 37%.

    This is real money for real people.

    You can watch Jenn’s full interview with Treasury Secretary Janet Yellen below.

  • A useful reminder on Nvidia

    While everyone seems to be an Nvidia (NVDA) expert now and waxing poetic on the stock’s recent sudden slide, I’m not going down that road this morning.

    Instead, I wanted to provide some factual numbers with the help of BTIG technical analyst Jonathan Krinsky. They provide some nice context for why Nvidia stock is taking a bit of a pause.

    Here’s what Krinsky had to say to remind the masses that stocks don’t go up every day.

    “NVDA recently traded ~100% above its 200-day moving average. Since 1990, the widest spread any US company has ever traded above its 200-day moving average while the largest company was 80% of Cisco (CSCO) in March 2000 In other words, NVDA is in a league of its own. CSCO briefly surpassed MSFT to also become the largest market cap, and that marked CSCO’s and Nasdaq’s peak to date. we fully understand that the fundamentals are very different this time, in the last five years, NVDA is +4,280% compared to CSCO’s +4,460% gain in the five years leading up to its peak over the last 18 months, NVDA is + 827% which is actually double CSCO’s 18-month gain in ’00.

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