The actual results and the forecast beat the average market expectations by a great margin and there was nothing the company could do more to keep the enthusiasm going… but hey, they fell short of the highest estimates on Wall Street. And when I say ‘highest estimates’ I am talking about third quarter revenue forecast from some analysts of nearly $38bn, for example, which is off chart but which is also the reason why Nvidia’s stock price could challenge odds and rumours that it was maybe overvalued.

So guess what, investors were not impressed by the comfortable revenue beat that Nvidia announced last night – a 7th consecutive quarter beat and the 5th consecutive quarter beat of $2bn – and sent the stock price nearly 7% lower in the afterhours trading. The shiny results were clouded by the delay of the next-generation Blackwell chip and the rising worries that competition will soon arrive to tap into Nvidia’s monstrous market share – that stands near 80% for the advanced chips. Combined with the news that Nvidia is under the DoJ investigation regarding whether it has abused its dominant market position doesn’t make the Nasdaq futures look good this morning. They are down by around 0.62% at the time of talking.

Super Micro Computer dived another 20% yesterday after announcing that they will delay filing its annual financial disclosures – a day after Hindenburg threw mud on the company saying that they had ‘glaring accounting red flags, evidence of undisclosed related party transactions, sanctions and export control failures and customer issues’. The delaying of the report naturally raises the odds that they might be right.

All in all, mood in the Big Tech is not great this morning. But the British and European futures seem little affected by Nvidia news. The futures point at a positive start this morning, and the waning appetite in Big Tech could cause more rotation toward the non-tech sectors as the Fed is on course to start cutting its interest rates in a couple of weeks. As such, the S&P500’s equal weight index could continue to close its gap with the technology-heavy, normal-weight index, but the upside potential could only be lower provided that the remaining S&P493 could barely make investors dream more than the Federal Reserve (Fed) rate cuts’ benefits on their valuations.

FX & commodities

The US dollar index rebounded yesterday from ytd low levels, although the US 2-year yield – that best captures the Fed rate expectations – continued its descent below the 3.90% level.

Today and tomorrow, attention shifts to economic data. The US will reveal its latest GDP update today and the core PCE index tomorrow, and over in Europe, the Eurozone countries will start revealing their flash CPI figures for August and the aggregate number will fall tomorrow morning. The US economy is expected to have grown 2.8% in Q2, double the number printed in Q1, but the price pressures are expected to have eased. And despite the strong looking Q2 GDP figure, the growth in the Q3 has likely slowed to 2%, according to Atlanta Fed’s GDP Now forecast.

Therefore, even a figure in line with expectations may not discourage the Fed doves, if the price pressures continue to show further progress. In Europe, tomorrow’s figures are expected to confirm a further slowdown in inflation – combined with the sluggish economic data from the old continent – could reinforce the expectations that the European Central Bank (ECB) could cut more than the 50bp cut baked in the market prices. The Fed on the other hand is expected to cut 100bp which looks overdone. The EURUSD is off the recent highs and has room for a further downside correction.

Across the Channel, Cable remains bid below the 1.32 mark on expectation that the Bank of England (BoE) is set for a less aggressive – but a more realistic - rate cut path than its American peer, but the warnings from Mr. Starmer earlier this week that October’s budget ‘will be painful’ could weigh on Britain’s growth outlook and limit sterling’s upside potential.