Nvidia To Test S&P 500 Strength, NYSE Insider Reportedly Says

According to a report from CNBC, Jay Woods, chief market strategist at Freedom Capital Markets, said that he is keeping an eye on Nvidia stock to note whether it will move steadily higher after its Q4 results.

• The NYSE insider reportedly said that it would be even more vital to consider the earnings’ impact on the S&P 500 due to Nvidia’s 7% stake in the broader market.
• Woods said the focus is because of how recent tech stock earnings results impacted the broader market, citing a decline in both Meta’s and Palantir’s shares despite the companies reporting strong results.
• Apart from Nvidia, results from Salesforce and Snowflake, also due on Wednesday, are also likely to impact markets, Woods said.

Nvidia Corp.’s (NVDA) fourth-quarter (Q4) earnings results will test important levels in the stock market this week, Jay Woods, chief market strategist at Freedom Capital Markets, reportedly said.

According to a CNBC report, Woods said that he is keeping an eye on Nvidia stock to note whether it will move steadily higher after its results, due on Wednesday.

The NYSE insider reportedly said that it would be even more vital to consider the earnings' impact on the S&P 500 due to Nvidia’s 7% stake in the broader market.

The S&P 500 has been testing the 7,000 levels recently, and that is putting a focus on the index’s 100-day moving average at 6,822, he told CNBC.

The Rationale

Woods said the focus is because of how recent tech stock earnings results impacted the broader market, citing a decline in both Meta’s and Palantir’s shares despite the companies reporting strong results.

“Watch how [Nvidia] closes on Thursday. ... We want to see it open strong, stay strong. If not, if it pulls back, watch the 200-day moving average, this $173 area in Nvidia,” Woods told CNBC.

“If it breaks it, that would be a tell for this entire market. We could get a big flush out to 6,600 in the S&P 500 and Nvidia could go back to $150 over the next several months. So, very critical to watch the price action in Nvidia,” he added.

Apart from Nvidia, results from Salesforce Inc. (CRM), and Snowflake Inc. (SNOW), also due on Wednesday, are also likely to impact markets, Woods said.

Earnings Expectations

For the upcoming quarter, Wall Street analysts expect Nvidia to post a 68% increase in revenues, of $66.12 billion, according to data from Fiscal.ai.
Meanwhile, the street expects an earnings per share (EPS) of $1.53 for the quarter, up from $0.89 posted in the same period last year. Other market experts are also anticipating a strong quarter from the company.

Meanwhile, NVDA shares climbed 0.05% in after-market hours at the time of writing. The company’s stock has surged about 47% in the past year.

Simultaneously, U.S. equities climbed in Monday’s post-market hours. The SPDR S&P 500 ETF (SPY), which tracks the S&P 500 index, was up by 0.04% at the time of writing, the Invesco QQQ Trust ETF (QQQ) climbed 0.09%, and the SPDR Dow Jones Industrial Average ETF Trust (DIA) was 0.04% higher.

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