Nvidia close to taking the market cap crown once again
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Welcome to the Saxo Market Call. Before we get started, it's important we emphasize that the views and opinions expressed in this podcast are those of the host and guests and do not constitute investment advice or recommendations. All information provided is for educational and entertainment purposes only. Okay, it is Thursday, June 26, 2025. We have

Markets in a very good mood once again, led yesterday by the king of them all formerly, and now once again trying to take the throne. Nvidia with a big advance yesterday through all of the resistance, through 150, and even through the all-time intraday highs closing yesterday. Actually, I don't have the price in front of me, but it doesn't matter. It's an all-time high, 154-ish or above, and...

We talked about Micron earnings yesterday after the close being important for NVIDIA and really for the broader AI data center space and stocks related to it.

Pretty strong results. They were at $9.3 billion on the revenue for the quarter versus $8.9 expected. Earnings beating by about 10% on their EPS, $176 versus $160 expected. And that important HBM category for the data center, so that's the type of memory that would be feeding into NVIDIA-driven systems, a 50% growth advance for the quarter.

The reception after the close, a bit odd. I'm wondering if some of this is sort of the options players, the so-called vol crush. So it was a very strong report. The stock closed around 127, went as high as 137, very briefly intra or intrasession after the close, and then backed off all the way to 127 again after.

And it was trading up towards 130 in very, very early pre-session trading today. So a strong report there as, you know, keeps the sentiment high in the

uh, AI space. I have to admit, uh, you know, I have no idea where I am on the AI adoption curve. Certainly not an early adopter. Uh, I don't think I'm a dinosaur, hopefully, but, uh, I was playing around with mid journey yesterday and even bought a subscription just to get myself more acquainted with these, uh, graphics generators, uh, frustrated with having to, having to find stock images for some of my updates and, uh, pretty quickly got it to produce a nice little, uh, image of, uh,

A US $100 bill that I actually used for my graphic for today's FX update. So if you follow the link there in the podcast description, you can see what basically this just looks like a photorealistic picture with a little bit of a flare on terms of the angle and focus of a US $100 bill.

All right. Also boosting sentiment and crushing volatility all the way back to essentially the low since February. If you look at the VIX, was the news, uh, the wall street journal exclusive, at least on speculation that Trump will appoint a fed, uh, the new fed chair to replace Powell when his term runs out in May of next year. Uh, very, very early. Uh, this had us yields, uh, down across the curve, but especially at the front end of the curve off several basis points. And, uh,

Who is this person going to be? I'm not sure I understand why Besant is being circulated so much as a potential replacement because to me in the era of fiscal dominance when it's the sort of the exigencies around keeping the U.S. treasury market stable, keeping the U.S. government funded when it's not raising revenues enough relative to outlays.

Fiscal dominance means that the Fed slowly loses independence. We're kind of seeing that in any way if we do see a very early nomination as the nominee to qualify has to be very dovish, obviously. So the more creative, interesting, important, and dominant task is in fiscal dominance lies with the Treasury, not with the central bank chair or Fed chair. So yeah, in any case, this, of course, not only saw U.S. yields lower, but saw the U.S. dollar sharply lower. And so

a little bit frustrating that us dollar picture it is still a little bit constrained mostly to the euro and against european currencies sterling to quite a large degree i'm not quite sure i understand why sterling is so loudly stronger here i think some of that is carry traded has been carry trading of late with that drop in global volatility it feeds for example starting in these types of trades where you're enjoying the interest rate differential as well as the appreciation but

A bit interesting to see that the yen snapped back a little bit stronger even than the euro and other currencies overnight. And we saw dollar-yen busting below that 144.50, a very minor local support level. It really needs to build momentum into that 142.50 and below that area to suggest that we're going to mount a challenge on the big 140 level. But certainly dollar weakness, the order of the day in foreign exchange, and just, I mean, a mind-blowing situation.

Uh, thing for me is to see, uh, I'm actually forgetting what dollar Swiss was trading when I first started, uh, in the currency markets back in the, in 2002. I remember the year dollar was the big thing in play. There was, Ooh, your dollar will hit parody. It was, uh,

It was around 95 and had, of course, bottomed out around 82. And Euro-Swiss, by the way, back then was around 1.6, currently at 0.94-ish. But anyway, long story short, seeing Dollar-Swiss below 0.80 is quite mind-boggling to my mind. Quite remarkable stuff to see that level. Although, yes, we did see that level briefly back in 2011.

Eurodollar breaking above 117, 140-something was the high before I stepped in here. It's coming back in a little bit.

And then looking over, I think this has helped out certainly in the metal space, at least versus the U.S. dollar. Really nice hammer reversal in silver there. Tested. Didn't go all the way to test that 35, the round figure level, but got pretty close to it. And the vigorous rebound suggests that the bulls have a nice risk point to trade from there. The metal we've covered a lot of late, platinum hit an 11-year high, just powering higher, smashed through that 1340 level from way back in 2021-2022.

And, yeah, 11-year highs there, Chinese jewelry demand. Again, it doesn't take much demand in this much, much, much smaller volume market than the other metals. These platinum group metals, with platinum itself being one of them, of course, are very, very tiny in terms of the overall supply. And then I think gold, it's encouraging for gold bulls that this recent sell-off did not extend, but still.

Arguably, we need to recover $3,400-ish to sort of stabilize the price chart in the upper part of the range. Yeah, so what are we supposed to look at here? And actually, I didn't round out the foreign exchange talk with one thing I wanted to mention, and that was the Renminbi. I think the one thing that could really help to broaden out the dollar range

weakness would be a more pointed position from China in allowing its currency to strengthen more versus the U.S. dollar and to stop having it. Yes, we're at the lows in dollar Swiss. Sorry, dollar Swiss. Dollar renminbi for the year, the dollar CNH at least around 716 we've seen today.

But in relative terms, what you see is that it tends to – if the dollar is weak, you see the ribbon being also sort of weak in the crosses. And there's not much momentum at all in that chart. So seeing China, I'd love to move further. I would encourage Aussie to finally blast out of this range.

that has been stuck in for ages here, 65, 50 plus, et cetera. And I think set the more, a stronger directional move in motion in the dollar and a broader move. There's a fairly good strength in the euro dollar and some of the European crosses versus the dollar, but not yet in yen because of that pesky 140 level. And then with, of course, the rest of Asia, which would go with Chinese renminbi.

But yeah, here we are at all-time highs in the U.S. NASDAQ 100 at least. We got a key report from Micron to help us out on the AI space, NVIDIA exploding higher. Seeing a little bit of signs of some of the real speculative areas that are

you would think would also be cheerleading here, not really performing among those Tesla, which fully backed out that robo taxi launch boost that it got. So we fully back to square there. I think that's a negative sign for that stock. I've seen some other headlines around jittery behavior of the software and, and, and of yeah, in this experiment going on in the launch of the autonomous driving in Austin and,

And Palantir, a shooting star candlestick yesterday, nothing too threatening really. It just strikes a bit of a sour note. You see a shooting star reversal like that on a day when the market is having a strong day. And then Bitcoin lagging a little bit. It hasn't been posting new highs, but it's not exactly sending off any amber even, any amber signals or much less red signals here.

And then if we look forward at two earnings reports, and by the way, of course, we're rolling into quarter end here. Quarter end is on Monday. Rebalancing could be a risk here with the strong performance we've had in stocks. But I mean,

Yeah, let's see. I think the more interesting thing is it's always interesting when you're posting a technical high, especially something like NVIDIA, a marquee stock with a big, loud, new high, very strong day, sets up this needs to continue or else it risks becoming a rejection scenario. So I think that's one of the more interesting developments here. You have the risk of a melt-up idea.

If the focus remains on the falling volatility, the Fed is supportive. Maybe we can get Trump announcing somebody. Could it be Warsh? Could it be one of the others? Warsh is at 23%, by the way, on Polymarket. Can this continue to feed this market before we start? And there's also the possibility that for the coming month or two, the market doesn't want to or doesn't care about somewhat weak data because it's like, oh, this is just the –

the pre-tariff rush hangover that was inevitable anyway. We're seeing that in things like the trade data that we have out today, advanced trade goods, et cetera, which have, of course, was a massive yawning deficits in the months leading up to the tariff announcements. And they've sort of normalized and could even go into extremely low levels in the coming month or two, including the one for today.

We have the PCE as well tomorrow. That could be another sort of feeder of this whole situation if we get a negative surprise there on the core. It's expected at 0.1% month-on-month on the core PCE for the U.S. If it is lower than that, this is going to jump those July expectations higher, July cut expectations higher, I should say. For the Fed, currently priced around 25% odds that they move further.

It seems like with Powell, with the withering pressure from Trump, would be really happy to see a negative surprise there, just so we could have an excuse and cover two cut rates. And then, for example, we have the jobless claims today. Could this one be weak? And we have another monthly report as well before that July rate meeting. So I think July very much in play if the data cooperates with, you know, I think that the data wouldn't have to be as bad as expected today.

as bad as would have been needed, sorry, previously to get that rate cut under the belt. Yeah, and I think I'll round out with an earnings report I'm anticipating a lot. I love the idea of, I love things that are weak or that have been pounded down and there's a turnaround story

Just my nature, I like to be contrarian. So just an interesting earnings report. And I don't really have a directional view so much on the company. I just think it's got a more interesting valuation than so many things that are overvalued in this market because of indexing and otherwise. And that's Nike. Nike reporting after the close today in the U.S.,

They're down around 35% over the last 12 months, down 66% from their all-time highs back in late 2021. This is seen as being the trough quarter. So in other words, the prior CEO's strategy was a mess and got the company in a bad hole. And you've got the new CEO on board for some time now, and they're really busy in the real

rearranging their whole strategy from this direct to consumer approach to back to using more wholesalers. In other words, selling the Nike brand through other large retail outfits, uh, et cetera, a purging inventory, you know, trying to get all this stuff out the door that they don't want anymore and a new product innovation lines, et cetera. One of the future ones that was apparently delayed, uh, is, uh, and they've apparently had quite a hard time with a female, um,

the female audience for, for Nike products is this skims brand, Kim Kardashian's skims brand. So that'll be something interesting to watch what they're saying about that on terms of timing or any of their new product lines starting to get traction, uh, whatever, but this is meant to be the trough quarter minus 15% year on year expected, uh,

for the quarterly results. Of course, there was a pandemic quarter that was worse than that, but you have to go back to 1998 to find a 15% year-on-year growth decline for the company. The volatility is very high heading into this, so the implied options volatility for

For this release, you have a Friday expiry options trading at something like 133% implied volatility. That translates to about a 4% move for – a 4% cost for an at-the-money call for this earnings report. So this stock is going to move a lot in one direction or the other is what the market is saying based on that very high volatility, 82% implied volatility ranking.

for the company. So I'm really curious to see that and to see if there's a turnaround story, if it's getting traction now or if it will get to traction, because if it can get traction, then the stock price has a lot of potential to certainly to move to the upside.

in valuation terms. All right, that was it for today. We'll try to be back tomorrow with a full Monty with a nice slide deck for you with a nice calendar of the week ahead, earnings reports incoming and other bits and pieces that we find interesting, especially in our must listens and must reads. So stay tuned for that. Stay careful out there and we'll be back tomorrow with the next Saxon Market Call.