Morning Brew February 27 2025

Good morning,

Nvidia`s earnings beat expectations but failed to spark any large excitement. In the after market, shares gained to 134.90 but the move did not meet option traders expectations of an 8% move. While the demand for Blackwell was very strong and sales exceeded expectations, the profit margin expected for the current quarter disappointed slightly. Here is Jacob`s initial take and Koen`s Option ideas:

• AI remains a long-term growth driver, but Nvidia’s stock may no longer deliver the explosive gains of the past.
• Investor expectations were sky-high, and while earnings were strong, they weren’t a game-changer—markets were looking for a bigger catalyst to drive stocks meaningfully higher.
• The AI trade is maturing, and future stock gains will depend on execution and new catalysts—watch for hyperscaler spending trends, product rollouts like Blackwell, and broader market sentiment.

Good morning,

Nvidia's earnings beat expectations but failed to spark any large excitement. In the aftermarket, shares gained to 134.90, but the move did not meet option traders' expectations of an 8% move. While the demand for Blackwell was very strong and sales exceeded expectations, the profit margin expected for the current quarter disappointed slightly. Here is Jacob's initial take and Koen's option ideas:

Jacob`s Key points:

• AI remains a long-term growth driver, but Nvidia’s stock may no longer deliver the explosive gains of the past.
• Investor expectations were sky-high, and while earnings were strong, they weren’t a game-changer—markets were looking for a bigger catalyst to drive stocks meaningfully higher.
• The AI trade is maturing, and future stock gains will depend on execution and new catalysts—watch for hyperscaler spending trends, product rollouts like Blackwell, and broader market sentiment.

Koen`s Option Take

• The dominating topic is the Trump tariff mayhem, where on February 27 it remains unclear if the tariffs on Mexican and Canadian goods will take effect on March 3rd or not, while he is already floating tariffs against the EU.
• The European indexes traded a little lower after the news got out yesterday evening, but then the news was widely ignored, and the GER40 is back at 22640, and the little-watched SMI is back above 13000.
• Ukrainian President Zelinski is set to visit the US tomorrow to sign the mineral deal.
• US indexes were mixed, the Dow down 0.45%; S&P 500 unchanged, and the Nasdaq up 0.25%. Worth noting is that the Magnificent Seven are down 4.5% year to date, while the other S&P 500 stocks are up 5.2%. Tesla can't find significant buyers and may test the 200-day moving average soon. The US500 has been toying with the 100-day moving average, which is worth keeping an eye on.
• The USD Index gained minutely to 106.62, while 10-year yields hold sub 4.3%. EURUSD is 1.0470, GBPUSD 1.2660, and USDJPY 149.30. Gold and silver are 2892 and 31.80.
• Today there is a flurry of economic data, but more of secondary importance before we head into the month-end and the PCE inflation tomorrow. There are several Fed speakers as well.

Thursday: DE Unemployment, Swiss GDP, Spain Inflation, EU Business Climate, US Durable Goods, GDP, Initial Jobless Claims. Earnings: Norwegian Cruise Lines, TD Bank, Soundhound, Dell.

Friday: Japan CPI, UK House Prices, CH KOF, US PCE. Earnings: Frontline.