U.S. inflation data and earnings from major AI-driven tech firms are expected to shape market direction, with the 10-year Treasury yield and tech stocks under particular scrutiny. Traders are bracing for shifts in rate expectations amid key macroeconomic signals.
- Core PCE inflation expected at 2.8% YoY, slightly above forecast
- NVIDIA’s revenue projected at $34.5B, up 18% QoQ
- 10-year Treasury yield at 4.32% ahead of inflation release
- Tesla forecasted to report $1.2B loss
- Apple iPhone sales expected to rise 11% YoY
- SPX trading near 5,310, showing market caution
Markets are focused on the latest U.S. inflation report, with the core PCE price index expected to show a 2.8% year-over-year increase, slightly above the 2.7% forecast. This figure will be closely watched for signs of persistent price pressures, which could delay Federal Reserve rate cuts expected in early 2026. The 10-year Treasury yield has already climbed to 4.32%, reflecting heightened sensitivity to inflation data. The technology sector is also in the spotlight, with NVIDIA (NVDA) reporting quarterly earnings this week. Analysts project NVDA’s revenue will reach $34.5 billion, up 18% from the prior quarter, driven by strong demand for AI chips. A beat on guidance could lift the Nasdaq-100 (NDX) by over 2% in early trading. Tesla (TSLA) and Apple (AAPL) are also reporting, with TSLA expected to post a $1.2 billion loss amid ongoing production adjustments, while AAPL’s iPhone sales are forecast to grow 11% year-over-year. The S&P 500 (SPX) has remained range-bound near 5,310, indicating caution ahead of these releases. A stronger-than-expected inflation print could trigger a sell-off in growth stocks, particularly in the AI and semiconductor sectors, while a dovish signal may boost equities and weaken the U.S. dollar (USD). FX markets are also watching for any shifts in policy divergence between the Fed and other central banks. Investors across asset classes are adjusting positions ahead of the week’s key events. Active traders are using options strategies to hedge against volatility, while long-term investors are assessing whether recent tech rally is sustainable amid macro uncertainty.