Traders May Stick To The Sidelines Ahead Of Nvidia Earnings, Key Data

The major U.S. index futures are currently pointing to a roughly flat open on Tuesday, with stocks likely to continue experiencing choppy trading after seeing considerable volatility in the previous session.

Uncertainty about the near-term outlook for the markets may keep some traders on the sidelines following recent weakness, which saw the Nasdaq and S&P 500 move sharply lower over the three previous sessions.

Traders may also be reluctant to make significant moves of the release of earnings news from Nvidia (NVDA) after the close of trading on Wednesday.

“Nvidia is due to report its fourth-quarter and full-year results on Wednesday and investors will be looking forward to the usual demolition of forecasts and also positive guidance for the next quarter from chief executive Jensen Huang,” said AJ Bell investment director Russ Mould.

“Failure to deliver the customary upside surprise might not sit well,” he added. “Nvidia’s shares are no higher than they were last summer, despite strong earnings and ongoing investor enthusiasm for all things related to artificial intelligence, so any unexpected disappointment could cause some share price turbulence.”

Traders are also looking ahead to the release of some key U.S. economic data in the coming days, including the Federal Reserve’s preferred readings on consumer price inflation.

Not long after the start of trading, the Conference Board is due to release its report on consumer confidence in the month of February. The consumer confidence index is expected to dip to 103.0 in February after falling to 104.1 in January.

Following the significant pullback seen during last Thursday and Friday’s session, stocks saw considerable volatility over the course of the trading day on Monday. The major averages showed wild swings back and forth across the unchanged line as the day progressed.

The Nasdaq and the S&P 500 eventually ended the day firmly in negative territory, but the narrower Dow posted a modest gain.

While the Dow inched up 33.19 points or 0.1 percent to 43,461.21, the S&P 500 fell 29.88 points or 0.5 percent to 5,983.25 and the Nasdaq tumbled 237.08 points or 1.2 percent to 19,286.92.

The Nasdaq and the S&P 500 ended the day firmly in the red after President Donald Trump said previously delayed tariffs on Canada and Mexico are “going forward on time.”

Claiming the U.S. has “been taken advantage of” on “just about everything,” Trump said, “The tariffs will go forward… and we’re going to make up a lot of territory.”

The volatility on Wall Street also came as traders looked ahead to the release of the earnings news from Nvidia. The AI darling and market leader is scheduled to release its fourth quarter results after the close of trading on Wednesday.

A lack of major U.S. economic data may also have contributed to the choppy trading ahead of the release of the Federal Reserve’s preferred readings on consumer price inflation on Friday.

Semiconductor stocks moved sharply lower over the course of the session, resulting in a 3.0 percent nosedive by the Philadelphia Semiconductor Index.

Computer hardware, networking and software stocks also saw considerable weakness, contributing to the steep drop by the tech-heavy Nasdaq.

Retail stocks also showed a notable move to the downside, while significant strength was visible among pharmaceutical stocks.

Commodity, Currency Markets

Crude oil futures are falling $0.44 to $70.26 a barrel after rising $0.30 to $70.70 a barrel on Monday. Meanwhile, after climbing $10 to $2,963.20 an ounce in the previous session, gold futures are sliding $20.30 to $2,942.90 an ounce.

On the currency front, the U.S. dollar is trading at 149.59 yen compared to the 149.72 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.0504 compared to yesterday’s $1.0468.

Asia

Asian stocks declined on Tuesday as fresh U.S. trade measures against China and President Donald Trump’s comments that tariffs on Canada and Mexico “will go forward” rekindled fears of a global trade war.

The dollar strengthened on risk-off sentiment, pushing gold prices lower from record highs. Oil extended gains amid fresh sanctions on Iran and a commitment to compensate for overproduction by Iraq.

China’s Shanghai Composite Index slid 0.8 percent to 3,346.04 as the optimism about China’s tech sector cooled off and trade war fears resurfaced.

Hong Kong’s Hang Seng Index tumbled 1.3 percent to 23,034.02 after the Trump administration targeted China with new trade and investment restrictions, further straining relations between the two economic giants.

Alibaba Group Holding shares dove 3.8 percent after the company’s American depositary receipts fell 10 percent, the biggest decline since October 2022.

Japanese markets fell sharply even as shares of trading houses jumped after Warren Buffett said Berkshire Hathaway’s stakes in them would likely increase somewhat over time.

The Nikkei 225 Index slumped 1.4 percent to 38,237.79 as a result of rising trade tensions. The broader Topix Index settled 0.4 percent lower at 2,724.70. Mitsubishi Corp. surged 8.8 percent, Marubeni climbed 7.5 percent and Itochu rallied 6.7 percent.

Seoul stocks ended lower as the country’s central bank cut interest rates by 25 basis points to 2.75 percent and lowered its GDP forecast for this year to 1.5 percent from 1.9 percent in the November forecast amid ongoing political uncertainty surrounding President Yoon Suk Yeol’s impeachment trial. The Kospi dropped 0.6 percent to 2,630.29.

Australian markets ended notably lower after major companies such as Domino’s Pizza Enterprises and Johns Lyng Group reported lackluster financial outcomes.

The benchmark S&P/ASX 200 Index fell 0.7 percent to 8,251.20, while the broader All Ordinaries Index closed 0.7 percent lower at 8,498.

Zip Co. shares soared 13.9 percent after the buy-now-pay-later firm reported strong half-year results and reaffirmed its FY guidance.

Across the Tasman, New Zealand’s benchmark S&P/NZX-50 Index plunged 1.8 percent to 12,307.27.

Europe

European stocks are mostly higher on Tuesday as investors shrug off concerns about U.S. investment curbs on China and wait for Germany to sort out the formation of its new government.

On a light day on the economic front, official data showed the German economy contracted in the fourth quarter, in line with estimates.

GDP declined 0.2 percent from a quarter ago, reversing a 0.1 percent sequential increase in the third quarter, according to Destatis. The figures matched the estimate published on January 30.

On a yearly basis, GDP dropped by a calendar-adjusted 0.2 percent, as estimated, after falling 0.3 percent a quarter ago.

The U.K.’s FTSE 100 Index is up by 0.5 percent, the German DAX Index is up by 0.3 percent and the French CAC 40 Index is just above the unchanged line.

Thyssenkrupp AG has surged after reports that it will hold an extraordinary general meeting to conclude a spin-off of a minority stake in its warship division this calendar year.

John Wood Group shares have also jumped. The struggling oilfield services and engineering firm said it has received a fresh approach from Dubai-based Sidara that approached it with a £1.6bn buyout proposal last year.

Swedish telecom gear maker Ericsson has also moved to the upside after winning a 5G Core deal from India’s Bharti Airtel.

Meanwhile, consumer goods major Unilever has fallen after announcing that chief executive Hein Schumacher will step down after less than two years in the role and be replaced by finance chief Fernando Fernandez.

Automakers Renault, BMW, Mercedes Benz and Volkswagen are also moving lower after industry data showed passenger car registrations in the European Union dropped by 2.6 percent year-on-year to a four-month low in January 2025.

U.S. Economic News

Standard & Poor’s is scheduled to release its report on home prices in major metropolitan areas in the month of December at 9 am ET.

At 10 am ET, the Conference Board is due to release its report on consumer confidence in the month of February. The consumer confidence index is expected to dip to 103.0 in February after falling to 104.1 in January.

Federal Reserve Vice Chair for Supervision Michael Barr is scheduled to speak on “Financial Stability” before an event hosted by the Yale Program on Financial Stability at 11:45 am ET.

At 1 pm ET, the Treasury Department is due to announce the results of this month’s auction of $70 billion worth of five-year notes.

Richmond Federal Reserve President Thomas Barkin is also scheduled to speak on “Inflation Then and Now” before the Rotary Club of Richmond at 1 pm ET.