While US stocks are opening lower on this Monday morning, we are looking at the major stock averages off a little over 0.1%.
Now we did see the market rally on Friday with the Dow closing at a record high as Fetcher Jerome Powell made dovish comments in Jackson Hole.
Now his monetary stance appears to prioritize stimulating economic growth and maximizing employment over control.
Inflation.
Looking ahead to the rest of this week, Nvidia will be posting earnings on Wednesday afternoon, and the report comes as soaring AI evaluations continue to dominate the conversation on Wall Street.
Joining me as we kick off the week is Gabby Vropi, CEO and founder of Latino Wall Street.
Gabby, good morning.
Thank you so much for joining me.
So first and foremost, what is your reaction to Powell's speech?
Yeah, so that was quite something that everyone had been waiting for, right, because when we were looking at the probabilities, when you go on the Fedwatch tool, it was showing us over 90% of probability that we'll have a rate cut on September 17th, but what he was saying was not matching that 90% of probability, right?
Then, because of the new economic data, we saw that number fluctuate and then.
That was a decisive moment.
Every investor was paying attention to, and he did say, you know, that it is now time where basically it it makes sense with information they have to to start cutting rates.
So I think there was a defining moment.
I think it was a surprising moment too because he has not been on the same page with the administration and with Trump.
They've been contradicting each other.
And he's been even, you know, they've threatened to get rid of him, so I don't think anyone was quite expecting him to just, you know, be so clear and get on the side of cutting rates considering that in the last few weeks his tone was very different.
The fact that he did that was very good for the markets.
Now September 17th, it's, it's basically guaranteed right at this point, even if the the percentage of the probability under the Fedwatch tool can fluctuate, I think everyone is expecting a 25 basis point rate cut.
The question is, is that going to be enough to stimulate the market, or is that just Completely expected where we won't see much of a difference.
Yeah, and Gaby, now that Jackson Hole is in the rearview mirror and now that we're in the final week of August, hard to believe, that means Nvidia earnings are coming up ahead.
So for Q2 earnings, what are your expectations and what are you watching out for in the details?
Yes, so all Nvidia has done is grow massively year over year, quarter over quarter.
It's been exceeding expectations, and that's why it is where it is at now, right?
We've seen record highs recently and it's because it really has the fundamentals.
If you look at the company, the The fundamentals that the growth is there.
It's probably one of the companies that has shown the biggest growth we've seen in Wall Street by far.
So, um, you know, Nvidia is the number one company right now.
Um, the market cap is in the trillions of dollars and it's, it's um bigger now than Apple and Microsoft.
It's quite the, the success story.
Now what I'll be Looking out for it's um the recent agreement Nvidia did with the government about giving it a percentage of its sales from China that I think can hurt its bottom line because approximately 20% of Nvidia's um sales for the chips are from China, right?
So that we have to see if it's going to to impact um the bottom line. uh, one would think that it will.
However, I'm not sure we'll see that reflected quite soon yet.
We might have to wait longer.
I do expect Nvidia as always to deliver to exceed expectations.
Um, I wouldn't be surprised if we see another rally, but we do have to take a look and pay attention to all these new agreements with the government as we just saw with Intel that's giving it 10% of the actual company.
Um, you know, with Nvidia, uh, part of the earnings, um, from China on the exports, and yes, they do receive benefits in exchange.
They're not just giving away the money obviously it has to make sense, but the big question is, is that the benefits they receive, right?
Well, like, for example, with the tariffs, is that going to um outweigh the the money that they will have to give in return?
OK, Gabby, well, we will have to leave it there for today, but as always, great having you on the show.
Thank you so much for joining us and have a great day.
Thank you, thank you.
