Subsequent week (beginning 17 November) is shaping as much as be an enormous week for inventory market traders. Not solely will the world’s largest firm Nvidia (NASDAQ: NVDA) report its earnings however we’ll additionally get some essential financial bulletins and earnings from another main firms.
Right here are some things to be careful for.
The well being of the US shopper
I’ll get to Nvidia’s earnings in a minute, however first I need to spotlight the truth that US retail big Walmart will probably be posting its earnings on Thursday. Whereas most UK traders don’t have direct publicity to this inventory, its earnings might nonetheless have ramifications for his or her portfolios.
The rationale why is that Walmart’s earnings are extensively thought of to be one of the crucial essential bellwethers for the US economic system. On condition that the corporate is the most important bodily retailer/grocery enterprise within the US, its efficiency gives a real-time look into the well being of the American shopper.
If these earnings sign that shopper spending is slowing down, it might hit a spread of retail shares together with the likes of Amazon, JD Sports activities Style, Nike, and Lululemon.
On the identical time, weak earnings from Walmart might doubtlessly enhance defensive shares resembling Unilever, Reckitt, and Johnson & Johnson. These sorts of firms aren’t as economically delicate as others.
So, this report is unquestionably one thing to be careful for. Will probably be posted throughout the day on Thursday.
Vital financial knowledge
Now, subsequent week isn’t an enormous week for financial knowledge/studies. However there are a number of key issues to be careful for.
One is the US Federal Reserve’s assembly minutes, which will probably be posted on Wednesday. This can present perception into Fed officers’ ideas on inflation and the longer term path of US rates of interest.
One other is UK CPI inflation. This may even be posted on Wednesday and it might present clues in relation to the path of UK rates of interest.
Nvidia’s earnings
Turning to Nvidia’s earnings, which will probably be posted after the US market closes on Wednesday (somewhat after 9pm for UK traders), these are prone to be the most important space of focus for traders subsequent week. As a result of the synthetic intelligence (AI) theme has been the important thing pressure driving the market larger this 12 months and Nvidia is the most important and most essential participant right here.
When it comes to what traders and analysts will probably be on the lookout for right here, they’ll need to see:
- Robust income and earnings development: analysts expect income of $54.8bn (up 56% 12 months on 12 months) and earnings per share of $1.25 (up 60%).
- Robust knowledge centre development: that is forecast to come back in at $48.6bn, up 58% 12 months on 12 months.
- Robust steering: if steering is beneath expectations, the inventory is prone to expertise weak point.
- Commentary on essential points: some areas of focus right here will probably be Blackwell chip ramp up, robotics and self-driving automotive development, and China revenues.
Notice that if Nvidia’s earnings are disappointing, it might influence a spread of tech shares together with AMD, Broadcom, and Taiwan Semiconductor. It might additionally lead to market-wide weak point on condition that the inventory has a big weighting in main indexes.
If Nvidia’s share worth drops considerably, nonetheless, I’ll be taking a look at it as a shopping for alternative. Taking a medium-term view, I’ve a worth goal of round $250.
