Mixed Start for New York Stock Market Ahead of NVIDIA Earnings

Long-term Treasury Yields Rise Daily Due to Mid-to-Long-Term Inflation Concerns

NVIDIA Shares Expected to Move 6% Up or Down Tomorrow After Earnings Announcement

Ahead of NVIDIA's earnings announcement, the biggest event this week on the US stock market, trading opened with mixed trends in New York on the 27th (local time).

At 10 a.m. Eastern Standard Time, the S&P 500 index was fluctuating near unchanged at 6.468 points from the previous day. The tech-focused NASDAQ dropped 0.1%, while the Dow Jones Industrial Average rose 0.2%.

NVIDIA, which is set to announce its quarterly earnings for the end of July after the close, was trading down 0.8% at $180 in early trading.

The direction of the New York market tomorrow is expected to be determined by NVIDIA's results.

According to FactSet, NVIDIA has surpassed Wall Street's estimates in 11 of its last 12 quarterly reports, but in 4 of those, its stock weakened after the announcement.

With a market capitalization of $4.4 trillion, NVIDIA makes up 8.1% of the S&P 500 index. According to Bloomberg, options investors expect NVIDIA's share price to move about 6% in either direction the day after earnings, on the 28th.

Clark Bellin of Bellwether Wealth pointed out, "NVIDIA is the ultimate indicator of the AI story," and added that the market’s valuation has already priced in high expectations for NVIDIA’s strong performance. He stated that now, with Wall Street having essentially factored in a Federal Reserve rate cut in September, NVIDIA stands as the next hurdle the market must overcome to sustain the bull run.

Despite former President Trump's unprecedented removal of Federal Reserve Board member Lisa Cook, which caused large moves in the long-term Treasury market, stock markets overall reacted calmly except for long-term Treasuries.

With concerns mounting that if Trump takes control of the Federal Reserve, mid-to-long-term inflation will rise, long-term Treasuries extended their decline for a second straight day. Bond prices and yields move in opposite directions.

The 10-year Treasury yield rose 2.5 basis points (1 bp = 0.01%) to 4.251%, and the 20- and 30-year yields rose more than 4 basis points each, to 4.901% and 4.953% respectively.

Meanwhile, the 2-year Treasury yield, which tracks policy rates, dropped by 2 basis points to 3.652% as hopes for a September rate cut persisted.

The dollar strengthened against major currencies, with the Bloomberg Dollar Spot Index rising 0.3%. The Japanese Yen, which has typically been strong against the dollar, fell 0.5% on the day to 148.07 yen per dollar.

Bitcoin fell 0.2% to $111,120.36, while Ether was nearly unchanged at $4,588.6.

Jung-A Kim, Contributing Reporter kja@hankyung.com