Well, after a decent two weeks, the market decided to slump down. The tech factor particularly disappointed. And… I was wrong about NVIDIA last week. Basically everybody was though. So, NVIDIA just met investor expectations. You might be thinking, ‘Why did it drop then?’ It largely dropped because of how the market views NVIDIA. If you don’t know, NVIDIA has been that ‘Wow!’ stock. It always jumps up cause it consistently smokes investors expectations and does great. Objectively, NVIDIA had a great earnings report, but NVIDIA has set the bar so high, that meeting expectations isn’t enough for investors. Hopefully though, next week is better for my predictions. Now lets go outside of NVIDIA. If you are looking for better news, you’re not getting it. The market wasn’t doing too terribly for most of the week until Friday. The three major indexes closed really high on Thursday. NASDAQ almost broke a record. Then, Friday happened. NVIDIA, according to investors, did not do great. DELL showed a great second quarter thanks to its AI servers and their high demand, but predictions for the third quarter looks to be below what analysts deem acceptable. These two are major players in the tech market, and when they don’t do well, investors, who were pretty optimistic both Thursday and Friday, start losing faith in the market. Marvell Technology(no not the Marvel with Iron Man), a chip designer had a poor sales outlook, which basically dragged down the semiconductor industry. Inflation also remained steady, which is not good because it is still significantly above the Fed’s target. It is common knowledge that tech stocks often get the raw end of the bargain. When the market isn’t looking great, tech stocks are sold instantly and investors are way more volatile towards these high value tech stocks. September also is consistently not a great month in the market, so it is highly unlikely tech will bounce back. Now, let’s get to the predictions section- hopefully I do better this week.
Riser
Dollar Tree– Look, the market is giving off some clear signs right now, and that is caution. Dollar tre gives low cost good that are hard to come by in this market, and with all the inflation, consumers are definitely becoming more price sensitive which could boost sales for DLTR. It is reporting earnings this week and it usually beats analyst expectations, so if you want a stock that will 99% rise, you should go for Dollar Tree.
Faller
Broadcom– The semiconductor market does not look good. NVIDIA fell last week and so did Marvell, and both are titans in the semiconductor market. Considering they did poor, the market will be looking to Broadcom to deliver a very strong earnings report. Broadcom has done well largely due to its AI. You can see the similarity to NVIDIA, and considering it fell, I would expect the same for Broadcom. Anything short of great from them this week would certainly cause the stock to fall. It is most likely going to fall as worry and sentiment over the tech market continues.
Market Memo 