Remy Blaire engages in a compelling discussion with Gabriela Berrospi, the CEO and Founder of Latino Wall Street. The segment centers around the recent developments in the financial markets, particularly the Federal Reserve’s decision to cut interest rates for the second consecutive month after maintaining them for nine months.
Remy begins by highlighting the context of the Fed’s 25 basis point rate cut and the reactions from the market. Gabriela notes that the cut was widely anticipated, with a probability exceeding 95% leading up to the meeting. However, the real surprise comes from Jerome Powell’s press conference, where he casts doubt on the likelihood of a December rate cut. This uncertainty spooks the markets, as Gabriela explains that the probability of a December cut dropped significantly after Powell’s comments, leading to increased volatility.
The conversation then shifts to the recent earnings reports from major tech companies, particularly the MAG7 names, including Google, Microsoft, and Meta. Gabriela points out that while these companies are heavily investing in AI and data centers, this aggressive spending is starting to impact their stock performance negatively. Despite strong revenue figures, the focus on future earnings and spending forecasts becomes crucial for investors. Google stands out with a notable surge in its stock price following better-than-expected earnings, while Meta’s significant EPS miss raises concerns about its financial outlook.
As the discussion progresses, Remy and Gabriela explore stock milestones, including the recent record highs for the Dow, Nasdaq, and S&P 500, as well as significant valuations for companies like Apple and Nvidia. Gabriela shares her price target for Nvidia, which recently reached the $200 mark, and discusses the psychological effects of such milestones on stock performance. She emphasizes the importance of breaking through key levels in the S&P 500, particularly the 7,000 mark, and the necessity for positive earnings reports as the year comes to a close.