Nasdaq 100 Surges After NVDA Earnings Beat Expectations

Also 10-year T-note, silver, crude oil and Japanese yen futures

1. Nasdaq 100 E-mini futures (/NQ): +2%
2. 10-year T-note futures (/ZN): -0.13%
3. Silver futures (/SI): +0.18%
4. Crude oil futures (/CL): -0.69%
5. Japanese yen futures (/6J): -0.26%

Yesterday was an important litmus test of what matters more to markets right now: the Federal Reserve’s rate cut path or the AI narrative. The latter won handily. Nvidia (NVDA) earnings beat in every aspect possible, sending U.S. equity market futures surging higher post-market, which has continued this morning. But bonds remain weak following the January Federal Open Market Committee (FOMC) meeting minutes, leaving precious metals hanging in the balance. Catalysts on the earnings and economic calendars are few and far between the rest of the week.

Nasdaq 100 futures (/NQH4) moved sharply higher this morning as bulls digest yesterday’s earnings report from Nvidia. The chipmaker beat expectations and guidance expectations and is on track to add over $200 billion to its market cap. This is also dragging the broader market higher and even helped to prop up technology shares in overnight trading in Asia and Europe.

10-year T-Note futures (/ZNH4) moved lower after yesterday’s FOMC minutes reaffirmed the view that the Federal Reserve will hold off on cutting interest rates until later this summer. The 10-year yield is breaching levels not traded since November, albeit at a slow pace. The bond markets have mostly priced in the slower rate cuts at this point, and traders may be looking for a turnaround soon if upcoming data points to more progress on prices. Today, Treasury will auction 4- and 8-week bills, along with 30-year TIPS.

Silver prices (/SIH4) were nearly unchanged ahead of the Wall Street open, with rising yields across the short- and middle-end of the curve weighing on the outlook for precious metals. With a week left in February, the metal is on track to record a third monthly loss, although the 22 handle appears to be providing some support. But the Treasury market will have to see the selling stop to help prove a turnaround for metals.

Crude oil futures (/CLH4) are little changed this morning despite renewed tensions in the Red Sea, with British authorities stating that a vessel off the coast of Yemen was struck by two missiles launched this morning by Hothis. However, yesterday’s big gain in crude inventories in the United States seems to be offsetting the risks to the oil market. Traders have their eyes on today’s data due this morning from the Energy Information Administration.

Yen bulls can’t catch a break. Japanese yen futures (/6JH4) are down again, challenging February lows as hopes for a pivot from the Bank of Japan (BOJ) get pushed back. Next week will bring inflation data to the island nation, but the calendar for the rest of this week is light for the yen, leaving prevailing trends likely to go unchallenged. Meanwhile, the weak yen is helping Japan’s stock market to hit multi-decade highs.

Christopher Vecchio, CFA, tastylive’s head of futures and forex, has been trading for nearly 20 years. He has consulted with multinational firms on FX hedging and lectured at Duke Law School on FX derivatives. Vecchio searches for high-convexity opportunities at the crossroads of macroeconomics and global politics. He hosts Futures Power Hour Monday-Friday and Let Me Explain on Tuesdays, and co-hosts Overtime, Monday-Thursday. @cvecchiofx

Thomas Westwater, a tastylive financial writer and analyst, has eight years of markets and trading experience. @fxwestwater

For live daily programming, market news and commentary, visit tastylive or the YouTube channels tastylive (for options traders), and tastyliveTrending for stocks, futures, forex & macro.

Trade with a better broker, open a tastytrade account today. tastylive, Inc. and tastytrade, Inc. are separate but affiliated companies.