Nvidia stock price prediction: Nvidia’s upcoming earnings report on Wednesday could unleash a market jolt unlike anything the chipmaker has seen before, as per a report. Options tied to the stock suggest a potential swing of about $320 billion in market value in either direction, a move that would be the largest post-earnings reaction ever for the company, according to data from analytics firm Option Research & Technology Services (ORATS), reported Reuters.
Nvidia Earnings Could Spark Record $320 Billion Market Swing
The forecasted move of roughly 7% comes as investors wait to see whether the artificial intelligence boom that has powered Nvidia’s masive rise is accelerating or beginning to cool, according to the report.
A Reuters analysis found that at Nvidia’s current valuation of around $4.6 trillion, the options-implied shift represents a record-breaking potential one-day change, as per the report.
Over the last 12 quarters, Nvidia shares have moved an average of 7.3% the day after earnings, ORATS data showed, as per the Reuters report. A swing of the scale now implied would exceed the company’s previous record move, a $276 billion jump after its February 2024 results, reported Reuters.
AI Boom Under Scrutiny as Investors Await Nvidia Results
Nvidia has become a central force in the AI investment wave, with its graphics processing units dominating the market for training large language models and other AI systems and that influence has amplified the stakes surrounding each quarterly update, as per the report.Chris Murphy, co-head of derivatives strategy at Susquehanna, said that, “Nvidia’s impact goes far beyond the dollar swing,” adding, “As the anchor of the AI capex trade, its results will help define whether we’re in the next leg of expansion or entering digestion mode,” as quoted by Reuters.ALSO READ: Anthropic AI deal explained: Microsoft & Nvidia’s bet on Claude, diversifying beyond OpenAI – here’s the investment breakdown
Nvidia’s 8% Weight in the S&P 500 Adds Broader Market Risk
With roughly an 8% weighting in the S&P 500 Index, Nvidia’s results are expected to ripple across the broader market, reported Reuters. Murphy said, “The signal it sends — on demand, margins, supply chain, and investment posture — could shape sentiment across semis, hyperscalers, and AI infrastructure at large,” adding, “So while the stock may move plus or minus 7%, the narrative impact could extend across $10 trillion worth of correlated trades,” as quoted in the report.
Tech Stocks Pull Back Ahead of Nvidia’s Earnings
The technology sector has pulled back in recent sessions amid worries over whether AI-driven stock gains can continue, as per the report. Nvidia shares, despite being up about 38% for the year, have fallen roughly 10% since reaching a record high in late October, according to the Reuters report.
Investor Exits Add Pressure on NVDA Before Quarterly Results
Investors will be combing through Nvidia’s earnings for any indication of slowing demand in the sector that has powered markets in recent months. The stock has also come under pressure following news that several big-name investors, including Peter Thiel’s hedge fund and SoftBank, have exited their positions, as reported by Reuters.
What Nvidia’s Earnings Could Mean for Future AI Spending Trends
Jason Pride, chief of investment strategy and research at Glenmede, said that, “As a major S&P 500 constituent, its results will likely carry broader implications for business investment and AI-related spending trends,” as quoted in the report.
FAQs
Is a 7% move after earnings normal for Nvidia?
Yes. Nvidia typically moves around 7% after earnings, but this time the amount is far larger due to its massive valuation.
Why does Nvidia influence the whole stock market?
It makes up about 8% of the S&P 500, so any big move in Nvidia affects major indexes.