The Nasdaq 100 Index and its associated ETFs, like the Invesco QQQ (QQQ) and the JPMorgan NASDAQ Equity Premium Income ETF (JEPQ), have come under pressure in the past few days as investors remain concerned about the artificial intelligence (AI) industry and technology valuations. This article looks at the top catalysts for these assets this week.
Nasdaq 100, JEPQ, and QQQ to react to Nvidia earnings
The Nasdaq 100 Index is a top asset that mostly focuses on technology companies. Its top stocks are companies like Nvidia, Microsoft, Apple, Broadcom, Amazon, and Tesla.
The most important catalyst for the Nasdaq 100 Index and these ETFs will be the upcoming Nvidia earnings. These earnings are important as the company accounts for about 9.98% of the index.
The most important earnings report of our lifetime $NVDA
The company is also the most important in the market today because of the ongoing macro theme on artificial intelligence (AI), where it provides the most advanced GPUs.
As such, a sign that the AI industry is booming will likely push the Nasdaq 100 and its ETFs like QQQ and JEPQ higher. However, some hints that the industry is slowing may trigger a stock market crash this week.
There are signs that Nvidia will publish strong results this week. For example, in October, companies like TSMC and ASML published strong financial result, a notable thing since TSMC is the main manufacturer of Nvidia chips.
Additionally, top Nvidia customers like Microsoft, Meta Patforms, and Amazon published strong financial results. In a recent statement, Amazon confirmed that it would spend over $115 billion on AI investments.
Analysts are optimistic about Nvidia’s earnings
Wall Street analysts are optimistic that the company will publish strong financial results. The average estimate is that its earnings per share will jump from $0.81 in Q3’24 to $1.25 in Q3’25, a 54% surge. As it has done in the past, Nvidia will likely publish stronger-than-expected earnings.
The revenue is expected to come in at $55 billion, also up by about 56% from what it made a year earlier. Most importantly, the company’s forward guidance for the fourth quarter is that its revenue will be $61 billion, up by 56% YoY, while its EPS will be $1.42, up from 89 cents.
These numbers will cap a highly successful year for Nidia, when its revenue will cross the $200 billion barrier. It is expected to hit the $290 billion milestone in 2026.
In addition to Nvidia, other top companies like Walmart, TJX, Palo Alto Networks, Target, Intuit, NetEase, Veeva Systems, and Lowe’s will publish their results this week.
READ MORE: Nvidia stock: why did Morgan Stanley raise its price target before earnings?
Federal Reserve to publish its minutes
Meanwhile, the Federal Reserve is expected to publish minutes of the last meeting on Wednesday. The bank decided to cut interest rates by 0.25% to between 3.75% and 4%.
These minutes will provide more information on the deliberations that happen among officials. Most notably, focus will be on Jeff Schmidt, who voted against the cut. In his recent statements, he has argued that inflation remains stubbornly high and that the Fed should not cut.
On the other side of the spectrum was Stephen Moran, who voted for a 0.50% cut in that meeting. Moran, who is eying the Fed Chair seat, believes that the labor market is weak.
These minutes will provide hints on what the Federal Reserve will do in the next meeting. Current data shows that the odds of a cut in December have dropped to 50% from the year-to-date high of 92%.
There will be other catalysts for the Nasdaq 100, QQQ, and JEPQ ETFs. For example, the ongoing crypto market crash will affect some of the biggest companies in the fund. Also, the index may react to Donald Trump’s decision on Venezuela.
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