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05/24/2024 |

Market Update Into May 28th: NVDA Does It Again

All eyes were on NVDA and its pivotal earnings results this week. As many expected, Jensen Huang & Co. did not disappoint. There was a lot of excitement on the street with a double beat, a dividend increase, and a share buyback taking center stage in the announcement. The indexes responded well, initially, and despite a sharp selloff on Thursday, March highs were held on both the SPY and the QQQ. In other news:

With all major earnings now in the rearview, are indexes cleared for a low volatility continuation higher, or was Thursday just a foreshadowing of what’s to come? Let’s dig into the individual charts and see where things ended up.

Weekly Analysis

SPY (SPDR S&P 500)

The SPY broke its four-week green streak, closing slightly lower at $529.51 (0.002%), and nearly even with last week’s close. While Thursday’s selloff found the price testing the March highs, they appear to be acting as strong support for now.

This is a daily chart of the SPY index.

QQQ (Invesco QQQ Trust)

With a little help from NVDA earnings, the QQQ ETF regained its place as the strongest of the three indexes this week, closing at $457.95 (+1.37%). Despite a nasty selloff on Thursday, support was found at the 8 EMA, and the price managed to stay above the March highs, as well.

This is a daily chart of the QQQ index.

IWM (iShares Russell 2000)

Small caps were again the underperformer this week, closing at $205.44 (-1.27%). The price tested the top of the range on Monday but was immediately rejected. By week’s end, a powerful close below the 8 EMA coincided with a bearish MACD cross, suggesting the possibility of a short-term trend reversal.

This is a daily chart of the IWM index.

Earnings

Notable Results

ROST (Ross Stores)

  • EPS: $1.46  vs  $1.34 est 
  • SALES: $4.86B  vs  $4.83B est

INTU (Intuit)

  • EPS: $9.88  vs  $9.37 est 
  • SALES: $6.74B  vs  $6.65B est

WDAY (Workday)

  • EPS: $1.74  vs  $1.58 est
  • SALES: $1.99B  vs  $1.97B est

TD (TD Bank)

  • EPS: C$2.04  vs  C$1.85 est
  • SALES: C$13.88B  vs  C$12.23B est

MDT (Medtronic)

  • EPS: $1.46  vs  $1.45 est
  • SALES: $8.59B  vs  $8.44B est

NVDA (NVIDIA

  • EPS: $6.12  vs  $5.58 est
  • SALES: $26.04B  vs  $24.65B

SNOW (Snowflake)

  • EPS: $0.14  vs  $0.18 est
  • SALES: $828.71M  vs  $785.87M est

TJX (TJX Companies)

  • EPS: $0.93  vs  $0.87 est 
  • SALES: $12.48B  vs  $12.46B est

TGT (Target)

  • EPS: $2.03  vs  $2.06 est 
  • SALES: $24.53B  vs  $24.52B est

PDD (PDD Holdings)

  • EPADS: $2.83  vs  $1.42 est
  • SALES: $12.02B  vs  $10.65B est

XPEV (XPeng)

  • EPADS: $(0.21)  vs  $(0.27) est
  • SALES: $906.90M  vs  $867.33M est

M (Macy’s)

  • EPS: $0.27  vs  $0.15 est
  • SALES: $4.85B  vs  $4.86B est

AZO (AutoZone)

  • EPS: $36.69  vs  $36.20 est 
  • SALES: $4.24B  vs  $4.30B est

LOW (Lowes

  • EPS: $3.06  vs  $2.94 est 
  • SALES: $21.36B  vs  $21.12B est

ZM (Zoom)

  • EPS: $1.35  vs  $1.20 est 
  • SALES: $1.14B  vs  $1.13B est

PANW (Palo Alto Networks)

  • EPS: $1.32  vs  $1.25 est 
  • SALES: $1.99B  vs  $1.97B est

What’s Happening Now

NVDA (NVIDIA)

NVIDIA surged over 12.84% this week, adding ~$298 billion to its market cap after reporting stellar Q1 earnings: revenue of $26.04 billion (+262% YoY) and EPS of $6.12 (+465% YoY). The company also increased its dividend by 150% and announced a 10-to-1 stock split effective Friday, June 7th.

This is a market map of the S&P 500.

GOOG (Google)

Google was reorganized in 2015 to be a wholly owned subsidiary of Alphabet, and since then, June has been Google’s worst-performing month with a long history of negative returns. However, with AI momentum driving a 9.65% rise in May, could this be the year Google turns the tide?

This is a seasonality chart of Google.

IWM (Russell 2000)

In terms of percent change, the next two weeks have historically produced outsized returns for the Russell 2000 for over two decades. At the same time, recent 13F filings have revealed that billionaire investor Stanley Druckenmiller has placed a $664 million bet on small-cap stocks via call options. Good timing?

This is a seasonality chart of the IWM index.

Believe it or not, this is just a fraction of what happened in the markets this week. For a full run down delivered straight to your inbox every weekend, sign up for The Official TrendSpider Newsletter.