27.08.25 - Nvidia earnings - key market catalyst

Nvidia will release its quarterly earnings today after the market close. The stock trades near record highs, supported by strong momentum in AI-related names.

Markets: Nvidia shares trade close to all-time highs. AI-related stocks broadly benefit from the same momentum.

My View: Nvidia’s earnings today represent a major catalyst not only for the stock itself but also for the AI-heavy and tech-focused sectors. Current investor sentiment is clearly bullish, is also favored by the speculative investors, as reflected by the share price trading near record levels. This, however, increases the risk of disappointment.

The most important factor will not just be the headline numbers, but the guidance: Forward sentiment from management, Spending trends in AI infrastructure, Margin outlook and sustainability of current demand AI demand signals, especially from data centers and cloud infrastructure.

Who follows ETFMandate Market Insights knows that I remain rather cautious on the AI sector. Valuations have reached stretched levels, and I see characteristics of a potential bubble. While Nvidia might still deliver strong numbers, the expectations are extremely high. Any hint of slowing demand, weaker margins, or reduced investment appetite could trigger a sharp reaction – not only in Nvidia, but across the entire AI universe.

The outcome may very well shape the tone of the stock market into the end of August.

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