Week Ahead: A Cautious U.S. Consumer and Nvidia Earnings Take the Lead in Markets

Week Ahead: 24 Feb 2025

- Nvidia’s earnings report this week will once again be the highlight of the week. As the leader of the AI rally, the market will be watching closely to see if demand for GPUs meets expectations, especially following DeepSeek’s release of a highly efficient model.

- Another Sell-Off Friday, driven by weaker economic data and declining consumer sentiment. Equities, U.S. Treasury bond yields, and oil all fell. Even the CME FedWatch Tool reflected this weakness, now indicating the possibility of one to two interest rate cuts from the U.S. Federal Reserve this year.

- Also, Trump’s policy has shifted to retaliatory tariffs on digital taxes after introducing reciprocal tariffs. This is concerning news for the equities market.

- China’s tech sector and broader economy diverge after the recent market rally. The Hang Seng Tech Index, fuelled by AI optimism, has surged much more sharply than other Chinese market indices. While China’s economic data has improved, AI’s impact may not be as significant as investors anticipate. As a result, the market will be closely watching tech stocks’ momentum, with investors likely to exit once momentum weakens.

Medium Term:

S&P 500 (SPX): The S&P 500 falls back below 6,100 again. We remain cautious, watching for directional signals within the 5,970–5,832 range.

Straits Times Index (STI): STI's technical trend continues to trade higher. We maintain a positive outlook while staying alert for signs of supply.

Hang Seng Index (HSI): The China A50 Index (grey line) is still trending upward. The Hang Seng Index (candlestick) continued its upward trend. Closing above 22,650 could lead to the index trading toward the next target and resistance level at 25,000.

Long Term:

S&P 500 (SPX) trend remains upward

Hang Seng Index (HSI) trend remains upward

Straits Times Index (STI) trend neutral to upward trend.

Headlines Next Week:

- US Corp Earnings: Nvidia, Salesforce

- SG Corp Earnings: OCBC, CityDev, SembCorp Ind, Capland Invest, ST Eng

- US Speeches by US FED officials, PCE Report

- China PMI Surveys

- SG CPI, Ind Prod

Disclaimers apply

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