Nvidia Outlook Reignites AI Trade, Lifts Stocks Late

Stocks extended their rebound with a second straight day of gains, led by technology shares, as investors positioned for Nvidia’s earnings and digested ongoing debate around AI disruption and trade policy. Sentiment improved further after the close when Nvidia’s upbeat revenue outlook topped expectations, lifting futures and reinforcing confidence in the AI theme. Treasury yields edged slightly higher, the dollar slipped, and Bitcoin rallied sharply, signaling a renewed appetite for risk.

Key Headlines & Market Movers:

Nvidia’s Strong Outlook Revives AI Momentum: Nvidia’s first-quarter revenue projection beat estimates, sending shares higher in after-hours trading and boosting S&P 500 futures. The results helped counter recent volatility sparked by concerns that AI-driven disruption could weigh on incumbents, with strategists arguing that opportunities remain in companies able to monetize adoption and pricing power.

• AI Debate Broadens Beyond Mega-Caps: Investor sensitivity to AI risks was evident earlier in the week after a research note outlined hypothetical long-term disruption scenarios, but surveys suggest many view the “AI wrecking ball” narrative as overstated. Strategists at major banks emphasized broadening exposure across sectors and geographies, citing growing evidence from earnings calls that more companies are reporting tangible AI benefits.

Mixed Corporate Signals Outside AI Leaders: Earnings reactions were uneven, with Circle Internet Group surging on strong stablecoin demand while Cava and Axon posted sharp gains, offset by steep declines in GoDaddy, Diageo, First Solar, and Lowe’s after softer outlooks. AMD slipped despite a recent AI-related partnership, underscoring selective positioning within the broader tech complex.

S&P 500 Sector Performance

Looking Ahead

Investors will focus on follow-through from Nvidia’s results to gauge whether AI leadership can sustain the broader market rally, while monitoring bond yields and crypto strength as barometers of risk appetite. Policy developments, including President Trump’s engagement with major tech firms and lingering tariff uncertainty, remain a backdrop that could influence sector leadership and overall volatility in the sessions ahead.

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