Nvidia drops sharply ahead of tomorrow's financial results announcement, virtual currency related stocks also fall | 21st Financial Tankan

Traditional finance *2/21 (Wed)

• NY Dow: 38,563.8 -0.17%
• Nasdaq: 15,630.7 -0.9%
• Nikkei average: 38,363.6 -0.28%
• USD/JPY: 149.9 -0.03%
• NVIDIA: $694.5 -4.3%
• Microsoft: $402.7 -0.3%

The US stock market ended in negative territory today. The Nasdaq fell due to selling in IT and high-tech stocks such as Nvidia and AMD. The Philadelphia Semiconductor Index also fell. The market's attention has shifted to tomorrow's Nvidia financial results.

Nvidia, which has been driving the AI ​​boom, has appreciated 44% since the beginning of the year, but there seems to be concern whether the company's results for the November-January period (4th quarter), which will be announced after the market close tomorrow, will exceed investors' expectations.

Many analysts point out that the bar for Nvidia's financial results has been raised extremely high. HSBC's Frank Lee said on Market Watch: “We believe overall market expectations have risen significantly as consensus earnings are closer to our expectations. Therefore, we believe that the expected sales and profits for 2023 are significantly higher. “Compared to the surprise in 2024, the scope for further upside in 2024 is likely to be limited.”

Additionally, the minutes of the January FOMC meeting will be released tomorrow, and investors seem to be taking a more cautious stance.

Last week's better-than-expected inflation numbers dampened hopes for an early Fed rate cut. Additionally, data on collateralized overnight funding rates suggests that some traders are starting to price in the risk of another round of rate hikes.

Today's main market materials are as follows:.

• Nvidia's stock price falls, and its market capitalization of $78 billion disappears.
• Rival Microsoft has developed a network card to replace NVIDIA products.
• The People's Bank of China has lowered its 5-year prime lending rate (LPR) by 0.25%. Large-scale monetary easing to save the real estate market bubble from bursting.

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Important economic indicators/events from this week onwards

• 2/22 (Thursday) 22:30 Number of new unemployment insurance applications for the previous week in the US
• 2/26 (Monday) 24:00 Number of new homes sold in January
• 2/27 (Tue) 8:30am Japan January National Consumer Price Index
• 2/28 (Wed) 22:30 U.S. Q4 real gross domestic product (GDP) revised value
• 2/29 (Thu) 22:30 U.S. January personal consumption expenditure (PCE deflator)

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