The Market Situation and Inflation in the US
In February 2024, the financial markets experienced interesting volatility, mainly influenced by US inflation data and Nvidia's results. US inflation turned out to be higher than expected, which led to a postponement of an expected interest rate cut by the Federal Reserve (Fed). This resulted in a fall in equity indices, a rise in 10-year government bond yields and a strengthening of the dollar. For example technology index Nasdaq 100 broke the "Rising Wedge" which you can read about in the previous article - link. , however, subsequently Nvidia's 4Q results set the markets back and the "breakout" turned out to be a "fakeout".
The impact of Nvidia's results on the markets
Nvidia's results, however, brought positive momentum to the market. Nvidia reported a record $277 billion increase in market value after releasing results that beat expectations. Demand for its AI chips caused the company to forecast revenue growth of 233% for the next quarter. The news had a positive impact on the technology sector and helped boost stock indices like the S&P 500 and Nasdaq.
Just a quick reminder, you can find companies like Nvidia and the like in our product Futuro portfolio. - Link.
February's events in the financial markets have thus shown how significantly economic indicators and individual company results can affect market sentiment. While US inflation data brought a degree of uncertainty and led to caution among investors, Nvidia's results provided an optimistic view of the potential of the technology sector and allowed the markets to partially recover from previous losses. The major indices in the US, Germany and Japan ended the month at an All Time High.