"The day started off on a positive note, with Nvidia's shares (Nasdaq: NVDA) rising almost 5% thanks to a strong earnings report shared after the bell on Wednesday. The company's third-quarter revenue reached $57.01 billion with an adjusted earnings per share of $1.30-both exceeded Wall Street's estimates. Nvidia also shared that it expects $65 billion in quarter-four revenue, higher than the $62 billion analysts predicted."
"But Nvidia's success wasn't enough to repel investors' fears of an AI bubble or what had appeared to be an increasing unlikelihood of the Federal Reserve issuing a rate cut next month. As the day went on, each of the seven companies, including Nvidia, saw their stocks whipsaw-as did the tech-heavy Nasdaq Composite. In yet another twist, hopes for that rate cut rose again on Friday, with CME Group now reporting a 70.9% likelihood of a cut."
"Tech stocks have suffered in recent weeks amidst growing concerns that AI companies have overinflated values. Then, yesterday also saw the release of the September jobs report, after the government shutdown delayed it. There were 119,000 new positions added, a significant increase from the 50,000 jobs predicted, according to consensus estimates cited by The Wall Street Journal. Yet unemployment rose to 4.4% in an unpredicted shift."
Nvidia reported third-quarter revenue of $57.01 billion and adjusted EPS of $1.30, both above estimates, and projected $65 billion in fourth-quarter revenue versus $62 billion expected. Nvidia shares rose almost 5% after the report, lifting Alphabet, Amazon, Apple, Meta, Microsoft, and Tesla. Investor concerns about an AI valuation bubble and a reduced likelihood of a Fed rate cut triggered whipsaw trading in the Magnificent Seven and the Nasdaq Composite. CME Group showed a 70.9% probability of a Fed rate cut, and the Nasdaq began to recover from a potential 10-week low. The September jobs report showed 119,000 new positions, above the 50,000 estimate, while unemployment rose to 4.4%.
Read at Fast Company
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