US Equity Markets Experience Mixed Trading Amidst Bank Earnings and Inflation Data

US equity markets were mixed on Tuesday after big banks released their earnings reports. The Nasdaq touched a record high due to strong performance from Nvidia, while the S&P 500 lagged. The Federal Reserve's inflation report and big bank earnings took center stage, with Citigroup shares hitting their highest level since 2008 after a profit beat and buyback plan. Blackrock shares fell after a revenue miss.

US equity markets were mixed on Tuesday as investors digested earnings reports from major financial institutions. The Nasdaq touched a record high, driven largely by strong performance from Nvidia, while the S&P 500 lagged. The Federal Reserve's inflation report and big bank earnings took center stage, with Citigroup shares hitting their highest level since 2008 after a profit beat and buyback plan. Blackrock shares fell after a revenue miss.

Nvidia, a leading AI chipmaker, reported a significant boost in its stock price following news that it had resumed sales of AI chips to China. The company's CEO, Jensen Huang, met with former President Donald Trump, leading to a policy shift that allowed Nvidia to sell modified AI chips to Chinese customers. This move is expected to bring in much-needed contributions to Nvidia's quarterly earnings, with analysts forecasting a 4% revenue uplift in fiscal Q3 [1].

The earnings season kicked off with several top financial institutions reporting their results. JPMorgan Chase, Wells Fargo, Citigroup, Morgan Stanley, and Goldman Sachs were among the highlights. JPMorgan's report, scheduled for Tuesday, came after the bank beat estimates for the first quarter, while Wells Fargo's report followed a decline in net interest income for the prior quarter. Morgan Stanley's financials, released later in the week, showed record stock-trading revenue in the prior quarter [2].

The Federal Reserve's inflation report, released on Tuesday, provided the latest view of consumer prices. The Consumer Price Index (CPI) inflation report showed an annual rate of 2.4% in May, which was less of an increase than economists expected. This data has put pressure on the Federal Reserve to lower interest rates at its end-of-the-month meeting [2].

The week's calendar of key events also included earnings reports from Taiwan Semiconductor Manufacturing (TSMC) and Netflix. TSMC's quarterly earnings, released on Thursday, showed a 40% increase in revenue in the first half of the year due to strong demand for AI chips. Netflix's report, also expected on Thursday, followed a 12% growth in sales in the first quarter [2].

Investors will continue to monitor the earnings season and the latest economic data to gauge the health of the economy and the financial markets.

References:
[1] https://colitco.com/nvidia-resumes-ai-chip-sales-china-nvda-stock/
[2] https://www.investopedia.com/what-to-expect-in-markets-this-week-bank-earnings-june-inflation-cpi-retail-sales-netflix-11769986