1. Moving the market

The markets opened in negative territory, with Nvidia’s stock slipping ahead of its highly anticipated earnings report. By the end of the session, the major indexes had recovered, closing near their starting points.

Traders view Nvidia’s upcoming report as a potential catalyst to invigorate the market for the rest of the year, especially after the recent pullback from the post-election rally that had propelled the indexes to new highs.

However, last week, Federal Reserve Chair Jerome Powell signaled that he is in no hurry to cut interest rates, which dampened bullish sentiment.

Retail stocks suffered significantly, with Target’s shares plummeting 20% following its largest earnings miss in two years and a reduction in its full-year guidance due to cost pressures and weakening discretionary demand.

This decline dragged down the major indexes, along with the retail ETF and other retail giants like Costco, Walmart, Dollar Tree, and Home Depot.

This situation reflects the challenges consumers face in an inflation-plagued environment. Given that consumer spending accounts for 67% of GDP, the markets may soon recognize that the economic data might be more hype than reality.

The Mega-Cap tech sector experienced a sharp decline but managed to rebound, mitigating early losses. Bond yields ended the day slightly higher but showed significant intra-day volatility.

Gold prices rose for the third consecutive day, while Bitcoin hit another record high close to $95,000 before pulling back slightly at the end of trading. The dollar rebounded from Monday’s losses, and crude oil prices slipped in afternoon trading.

All eyes are now on Nvidia’s earnings report, due out this afternoon, which many traders consider the most crucial announcement for the remainder of the year.

1. Moving the market

Geopolitical tensions between Ukraine and Russia initially dragged the markets down, exacerbated by the U.S. administration’s approval for Ukraine to use American weapons to strike inside Russia, raising fears of a potential World War III scenario.

Despite this, the Nasdaq was the first of the three major indexes to recover, buoyed by a 2.4% rise in Nvidia’s stock ahead of its earnings release.

However, the persistent escalation of war rhetoric and uncertainty about the incoming administration’s response could lead to further market volatility.

By the end of the day, the major indexes rebounded, partly due to headlines suggesting that Iran is seeking to de-escalate tensions, which helped stabilize the markets.

On the economic front, Walmart’s stock surged 5% on strong earnings and an improved outlook on discretionary spending. Tesla also added another 2%, bringing its month-to-date rally to 38%, marking its best month since January 2023.

Additionally, the most shorted stocks were squeezed higher, the Mega-Cap Tech basket rebounded, bond yields slipped due to disappointing U.S. macroeconomic data, and gold prices increased.

Bitcoin continued its ascent towards the $100,000 mark, climbing above $94,000 to set a record high before pulling back slightly at the close.

Will $100,000 present a glass ceiling for Bitcoin, or will it break through this milestone?

1. Moving the market

The major indexes ended the day with mixed results, as only the S&P 500 and Nasdaq managed to close in the green. The Nasdaq received a significant boost from Tesla, which surged approximately 7% following news of potential regulatory easing for self-driving vehicles.

Traders are now turning their attention to Wednesday’s earnings release from chip giant Nvidia, which could influence the market’s near-term direction. Additionally, upcoming reports from key retailers are expected to provide valuable insights into consumer behavior and the broader economy.

Last week was challenging for the major indexes, which retreated from their post-election highs due to concerns about the Federal Reserve’s interest rate trajectory. Despite the Fed’s accommodative stance, having lowered rates by 0.5% and then 0.25%, the markets reacted negatively, with the 10-year yield rising sharply instead of falling.

Bond yields initially spiked but then lost momentum, reversing course, and closing lower. Bitcoin underwent a volatile session, trading within a range and ending slightly higher, maintaining its post-election gains. Gold, after a recent sell-off, rebounded with a 1.7% gain, while crude oil also recovered, reclaiming the $69 level.

Interestingly, Bitcoin and gold, which had been rallying in tandem, diverged after the election. Bitcoin surged higher, while gold faced profit-taking.

Will they be able to sync up again?