NVIDIA, econ data, and tariff talk stirring up the market

The gains seen in the equity futures market this morning are a breath of fresh relief air tied to the recognition that NVIDIA (NVDA) is trading 1.9% higher after its Q4 earnings report and outlook.

The report from the AI darling didn’t have the same “blowout” component attached to it like more recent reports, yet it was still pretty darn good with revenue growth of 78% (data center +93%), Q1 revenue guidance ahead of expectations, and the company talking about amazing demand for its Blackwell processor.

The price action in NVIDIA has been a staying factor for the broader market, which is digesting some guidance disappointment from Dow component Salesforce (CRM), some reporting enthusiasm for Snowflake (SNOW), and a large batch of economic data:

• Initial jobless claims for the week ending February 22 increased by 22,000 to 242,000 (Briefing.com consensus 220,000). Continuing jobless claims for the week ending February 15 were 1867K (prior revised to 1867K from 1869K)
  • The key takeaway from the report is that initial jobless claims reached their highest level since early December, which will add to the market’s festering concerns about a slowdown in growth. 
• The second estimate for Q4 GDP was 2.3% (Briefing.com consensus 2.3%; prior 2.3%) while the second estimate for the Q4 GDP Deflator was 2.4% (Briefing.com consensus 2.2%; prior 2.2%)
  • The key takeaway from the report is that the growth was driven largely by consumer spending and government spending, but with targeted efforts by the Trump administration to cut government spending and to implement tariffs, there will be concerns about GDP growth decelerating in coming quarters due to less of a contribution from consumer spending and government spending.
• January Durable Goods Orders were up 3.1% (Briefing.com consensus 1.8%; prior revised to -1.8% from -2.2%). Excluding transportation, durable goods orders were flat (Briefing.com consensus 0.4%; prior revised to 0.1% from 0.3%).
  • The key takeaway from the report is that nondefense capital goods orders, excluding aircraft — a proxy for business spending — logged a healthy 0.8% increase in January, offsetting the headline disappointment of an unchanged reading for durable goods orders, excluding transportation.

This dataset took a little wind out of the equity futures market initially and triggered some knee-jerk action in the Treasury market. By and large, though, it did not derail the bullish bias that existed prior to its release. A tariff update from President Trump, though, knocked the futures market off its bullish stride.

In a Truth Social Post, President Trump said that tariffs for Canada and Mexico will start March 4, that China will face an additional 10% tariff as well starting March 4, and that reciprocal tariffs will go into effect April 2.

It remains to be seen if these reminders will deplete all of the goodwill created by the reaction to NVIDIA’s report and outlook. We’ll know soon enough, but the key to market sentiment isn’t how the market starts today but how its looks when it closes.

Currently, the S&P 500 futures are up 16 points and are trading 0.3% above fair value, the Nasdaq 100 futures are up 147  points and are trading 0.7% above fair value, and the Dow Jones Industrial Average futires are down 46 points and are trading 0.1% below fair value.

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Originally Posted February 27, 2025 – NVIDIA, econ data, and tariff talk stirring up the market