2026-02-26 10:55:00
The big story in the equities market came after the close yesterday, with Nvidia delivering a major beat in their earnings report across the board. That saw shares of the tech giant rose by over 3% for a brief period in after-hours trading before settling with more modest gains. In turn, broader market sentiment also retreated and that’s making for a more tepid mood seen in Asia and early European morning trade thus far.
S&P 500 futures are down 0.1% currently, with Nasdaq futures also down 0.1% on the day. As we look to the open later, Nvidia shares are now seen up only 0.6% in pre-market. Even with a triple beat on revenue, earnings, and guidance, it’s not quite doing enough to drag the ship up as we gear up towards the Wall Street open in a few hours.
And the market saying is that when something can’t go up on good news, it surely means that there is danger up ahead.
That being said, it would be remiss of me not to point out that investors tend to put Nvidia up on an extremely high pedestal when it comes to earnings releases. And this time is no exception to that.
When perfection is the bare minimum, Nvidia’s latest earnings beat is pretty much what investors would really want to see with the poster boy of the AI rally. So when perfection is very much expected, the exemplary tends to become ordinary. And one can argue that is what we’re seeing here.
All that being said, the more tepid mood belies the fact that the S&P 500 is still just 0.8% away from reaching fresh record highs. And the Nasdaq is also bucking the technical downside break earlier this month to climb back up to its 100-day moving average – hitting a two-week high.
There are definitely still macro concerns with regards to geopolitics and trade, alongside software stocks still being hounded by the AI disruption. All of that is certainly going to make for more cautious steps in the short-term. But if you go by the charts alone, it certainly doesn’t feel like equities are in any sense of danger.
Yet, there’s still that lingering feeling that the AI disruption and Nvidia having to shoulder such a heavy weight can only go so far before a correction is due. There are growing concerns on how the hyperscalers i.e. Google, Meta, Microsoft can keep up on capex spending to support the outlook portrayed by Nvidia. And that adds to the prevailing narrative that software stocks are being heavily pushed down now by the same very AI disruption that Nvidia is powering.
Can big tech prove to be enough to do the heavy lifting if the rest of the market struggles? That might be the key juncture we’re at when viewing the latest developments.
