Okay, let’s talk about what’s happening in the stock market right now, because honestly? It’s pretty wild.
The S&P 500 is basically doing victory laps around all-time highs, and the NASDAQ is setting new records like it’s collecting Pokemon cards. But here’s the thing that’s actually got me excited: earnings season is absolutely crushing it.
Get this – 81% of S&P 500 companies are beating expectations. That’s not just good, that’s “your overachieving friend who somehow aced the test they didn’t study for” good. The overall earnings growth rate is sitting pretty at 11.8%, which in finance speak means “companies are making more money than anyone thought they would.”
But Wait, There’s More Drama
The plot thickens with some geopolitical theater. Over the weekend, the White House struck a deal with NVIDIA – you know, that chip company that’s basically become the main character of the AI story. They’re letting NVIDIA sell their H20 chips in China, but with a 15% “convenience fee” to Uncle Sam. It’s like Uber surge pricing, but for semiconductors.
This matters because Tuesday is the deadline to extend the tariff “timeout” with China. Will they? Won’t they? It’s like waiting for your crush to text back, but with global economic implications.
The Real Plot Twist: Physical AI
Here’s where things get really interesting. NVIDIA’s CEO Jensen Huang (who, let’s be honest, has become something of a tech celebrity) keeps talking about “Physical AI” – basically AI that doesn’t just live in your computer but actually does stuff in the real world. Think robots, but not the scary Terminator kind. More like the “finally, someone who can fold my laundry” kind.
The smart money is calling this a $20 trillion opportunity. That’s trillion with a T. To put that in perspective, that’s roughly the entire U.S. GDP. Twice.
What’s Coming This Week
We’ve got some heavy hitters reporting earnings this week: Celanese, Gilead Sciences, Cardinal Health, and Deere & Company. But the real main event? NVIDIA reports on August 27th. That’s when we’ll get the tea on how this whole AI revolution is actually going.
Plus, we’re getting some key economic reports: Consumer Price Index (CPI), Producer Price Index (PPI), and retail sales data. Translation: we’ll find out if people are still buying stuff and if prices are behaving themselves.
The Bottom Line
Look, I’ve seen enough earnings seasons to know that 81% beat rates don’t happen by accident. Companies are genuinely performing well, and the AI story isn’t just hype – it’s starting to show up in actual results.
The smart play? Keep an eye on companies positioned for this Physical AI wave. Because if this really is a $20 trillion opportunity, getting in early beats getting in late every single time.
Just remember: in investing, as in life, timing isn’t everything – but it sure doesn’t hurt.