The entire tech sector is holding its breath for Nvidia's results on Wednesday; investors are aware how hard it will be for the chip maker to meet stratospheric expectations.
Analysts are generally looking for quarterly revenue to almost double to around $92 billion, with full-year earnings guidance seen in a range of $103 billion to $105 billion.
Market participants will also be hoping for some clarity on the outlook for U.S. interest rates when Federal Reserve Chairman Kevin Warsh speaks in Jackson Hole, Wyoming, on Friday, though his well-known aversion to forward guidance could lead to disappointment.
"There are several reasons to expect to be underwhelmed," said Bruce Kasman, chief economist at JPMorgan, noting that past chairs have not wanted to front-run Fed decisions at the event.
"Warsh will rather likely focus on aspects of his 'regime change' agenda," Kasman added. "As the Fed has already been moving toward shrinking the balance sheet, and the committee gave the balance sheet some attention in the July minutes, that might be the most likely topic for him to expound upon."
Markets imply around a 40% chance that the Fed will raise interest rates when it meets on September 16 and are fully priced for a move by December. The odds could change depending on what U.S. inflation figures show this week, with median forecasts for core inflation expected to hold at 3.3% in July.
Warsh is sure to face questions about Treasury Secretary Scott Bessent's surprise announcement last week of at least a doubling in bond buybacks, aimed at restraining a rise in yields that was tightening financial conditions in the economy.
His efforts have had little success so far, with 30-year yields back up at 5.2760%, not far from the recent 19-year peak of 5.3371%.
Higher yields make debt more attractive compared to equities while lifting the discount applied to future earnings, highlighting the stretched nature of some valuations.
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