BULLISH NVIDA EARNINGS. BEARISH STOCK MARKET REACTION.

Crowded Market Report by Jason Shapiro

23 May 202404:34

Summary

TLDRIn the video script, Jason Shapiro from Crowded Market Report discusses the challenging market conditions on Thursday, May 23rd, 2024. Despite Nvidia's strong performance with increased dividends, a stock split, and earnings and revenue beats, the overall market was disappointing. Risk assets like silver and copper suffered, leading to speculation that the market is realizing the Federal Reserve won't cut rates soon. This could impact assets that benefit from lower interest rate expectations. The day might be pivotal, as it could mark a shift in market sentiment regarding recession and rate cuts, similar to a previous influential day that signaled the end of recession fears.

Takeaways

📉 The speaker, Jason Shapiro, acknowledges that it's hard to put a positive spin on the market's performance on May 23rd, 2024.
🚀 Despite Nvidia delivering on all fronts with a dividend increase, stock split, and beating on earnings and revenue, the overall market performed poorly.
🐻 The speaker speculates that the day could potentially be a 'bear trap', a situation where the market dips before rebounding, but it's too early to tell.
📊 Risk assets like silver and copper were hit hard, with silver experiencing a significant two-day decline and copper also suffering.
💡 The market might be realizing that interest rates won't be cut soon, which could affect assets that have been benefiting from the expectation of lower rates.
🤔 There's a Catch-22 situation where asset prices rising reduces the chance of rate cuts, while falling prices might make rate cuts more likely.
📈 The speaker mentions that the Dow Jones Industrial Average, which many people are heavily invested in, did not wait for Nvidia's positive news and started declining days ago.
📉 The Dow Jones experienced a notable drop, with a significant point loss over a few days, which could be a sign of a larger market trend.
🔮 The speaker suggests that May 23rd could be an important day in market history, similar to a previous significant day that marked a shift in market sentiment.
🤷‍♂️ There's uncertainty about whether the current market situation is just a temporary dip or the start of a more significant downturn.
👀 The speaker emphasizes the importance of monitoring the market's reaction to see if this day turns out to be a pivotal one in the market's trajectory.

Q & A

What is the date mentioned in the video script?
-Thursday, May 23rd, 2024.
Who is the speaker in the video script?
-Jason Shapiro.
What company is Jason Shapiro discussing in the context of the stock market?
-Nvidia.
What positive actions did Nvidia take according to the script?
-Nvidia increased dividends, performed a stock split, beat on earnings, and exceeded revenue expectations.
What is the general sentiment of the stock market according to Jason Shapiro's analysis?
-The stock market is performing poorly, with the exception of Nvidia.
What is a 'bear trap' in the context of the stock market?
-A bear trap is a situation where the market appears to be in a downtrend, but then reverses and moves higher, often trapping those who sold or shorted the market.
Which assets are mentioned as being affected by the market's performance?
-Silver, copper, and gold are mentioned as assets that have been hit hard.
What is the potential implication of the market's performance on interest rates according to the script?
-The market might be realizing that the Federal Reserve is not likely to cut interest rates soon, which could affect assets that benefit from lower interest rates.
What is the 'Catch 22' situation Jason Shapiro refers to in the context of interest rates and asset prices?
-The 'Catch 22' situation refers to the dilemma where asset prices going up reduce the chance of rate cuts, while asset prices going down might increase the chance of rate cuts.
What significant event in the past did Jason Shapiro mention as a possible turning point for the market?
-A powerful day a couple of months ago when the market decided that there would be no more recession and that everything was going to move forward.
What is the potential significance of the current day's market performance according to Jason Shapiro?
-The current day could be an important day that marks a change in the market's direction, possibly becoming a 'trigger day' similar to the significant day mentioned a few months ago.
What is the performance of the Dow compared to the NASDAQ as mentioned in the script?
-The Dow, which many people are long on, did not wait for Nvidia's announcement and has been down for a couple of days, while the NASDAQ made new highs right into the Nvidia announcement before reversing.
What is the potential outcome Jason Shapiro is considering for the market after the current day's performance?
-He is considering the possibility that the market might have entered a bear trap, or that it might be a significant turning point leading to new highs or further declines.

Outlines

00:00

📉 Dismal Market Performance Despite Nvidia's Success

In this paragraph, Jason Shapiro from Crowded Market Report addresses the challenging market conditions on Thursday, May 23rd, 2024. Despite Nvidia's positive earnings report, which included a dividend increase, stock split, and exceeding expectations on earnings and revenue, the overall market performed poorly. Jason speculates whether this could be a bear trap, a situation where the market drops sharply but then recovers, which is a common occurrence. He also discusses the impact on other risk assets like silver and copper, which have been hit hard recently, suggesting that the market may be starting to realize that interest rates are not likely to be cut soon. This could spell trouble for assets that have been benefiting from the expectation of lower interest rates, such as metals and the stock market. Jason also mentions the potential significance of this day in the market's trajectory, comparing it to a previous pivotal day that marked a shift in market sentiment regarding the recession.

Mindmap

Keywords

💡Bear Trap

A bear trap in financial terms refers to a situation where a security or market experiences a sharp decline followed by a quick recovery, often trapping traders who sold during the decline. In the script, Jason Shapiro mentions the possibility of the market's poor performance being a bear trap, suggesting that the downturn might be temporary and followed by a rebound.

💡Nvidia

Nvidia is a leading technology company known for its graphics processing units (GPUs) and artificial intelligence technologies. The script discusses Nvidia's positive corporate actions such as dividend increase and stock split, and how it performed well despite the overall poor market conditions, serving as a contrast to the broader market's performance.

💡Stock Market

The stock market is a platform where shares of publicly traded companies are bought and sold. In the video, the stock market's performance is a central theme, with the speaker noting the difficulty in finding positive aspects in the market's behavior on the day of the report.

💡Earnings

Earnings refer to the profits that a company generates, which are a key indicator of a company's financial health. The script mentions Nvidia beating on earnings, meaning the company reported higher profits than what analysts had expected.

💡Revenue

Revenue is the total amount of money that a company receives from its business activities before any expenses are deducted. The script notes that Nvidia also beat on revenue, indicating that the company's sales were higher than anticipated.

💡Interest Rates

Interest rates are the percentage at which interest is paid by borrowers and paid to savers on the money that is borrowed/saved. The video discusses the market's reaction to the Federal Reserve's potential actions regarding interest rates and how assets like metals and the stock market might be affected by expectations of rate cuts or increases.

💡Risk Assets

Risk assets are investments that are more likely to experience significant price fluctuations and carry a higher risk of loss. In the script, risk assets such as silver and copper are highlighted as having been hit hard, indicating a downturn in these markets.

💡Overbought

An overbought condition occurs when an asset's price has risen sharply in a short period, leading to a situation where it may be considered overvalued and due for a price correction. The script refers to the overbought status of certain assets, suggesting that their decline could be a correction after a period of rapid increase.

💡Dow Jones Industrial Average (Dow)

The Dow Jones Industrial Average, often referred to as 'the Dow,' is a stock market index that measures the stock performance of 30 large companies listed on stock exchanges in the United States. In the script, the Dow is mentioned as having experienced a significant decline, indicating a poor performance among industrial and energy stocks.

💡NASDAQ

The NASDAQ is a stock exchange traded computerized Quotation system for trading securities. It is known for listing technology and biotechnology companies. The script mentions the NASDAQ making new highs before experiencing a reversal, highlighting the volatility and market sentiment shifts.

💡Recession

A recession is a period of economic decline, typically characterized by a fall in GDP, high unemployment, and a drop in retail sales. The script implies that there was a previous belief that a recession was not imminent, but the current market conditions might be signaling a change in this perception.

Highlights

Today is a difficult day to put a positive spin on the stock market's performance.

Nvidia performed exceptionally well with a dividend increase, stock split, and beating on earnings and revenue.

Despite Nvidia's good performance, the overall market was not favorable.

The possibility of a bear trap in the stock market is mentioned, suggesting a potential market recovery.

Risk assets like silver and copper have been hit hard recently.

Silver experienced a significant two-day decline.

There is speculation that the market is starting to realize that interest rates will not be cut soon.

Assets that benefit from lower interest rates, such as metals and the stock market, may face challenges.

The market is in a Catch 22 situation regarding interest rates and asset performance.

The speaker suggests that today might be an important day in the market's trajectory.

A comparison is made to a previous significant market day that changed investor sentiment.

NASDAQ made new highs but then experienced a reversal on the day of Nvidia's announcement.

The Dow Jones Industrial Average did not wait for Nvidia's announcement and started declining days prior.

The Dow Jones experienced a significant drop, suggesting potential market instability.

The speaker emphasizes the importance of today's market performance and its potential impact.

A closing remark expressing hope for the well-being of listeners and a promise to provide further updates.