Beware: Nvidia Gains Are Masking Broader Market Weakness

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USD/MXN News

S&P 500,Dow Jones Industrial Average,NVIDIA Corporation

Stocks Analysis by Michael Kramer covering: USD/MXN, S&P 500, Dow Jones Industrial Average, NVIDIA Corporation. Read Michael Kramer's latest article on Investing.com

Nvidia has indeed distorted the index and made the S&P 500 useless in some ways. When one stock can offset one index by a meaningful amount daily, that index does not accurately indicate the broader market. The S&P 500 was up almost 6 points, while Nvidia had contributed almost a 16-point gain. So, without Nvidia being up almost 5% on the day, the index would have been down around 10 points. Now, if this happened as a one-off, it is not a big deal, but this seems to happen nearly daily.

Yesterday’s reading suggests the real GDP is growing around 1.7%, which is okay but certainly not recessionary. It probably suggests that the dollar has fallen too much, but the data for the rest of the week will be just as important.fell following news that OPEC production cuts were being extended until year-end but that some voluntary cuts could be eased by October.

At least over time, the S&P 500 and the USD/MXN have had an inverse relationship, and if that relationship continues, then the aftershocks of yesterday’s peso move could be felt in the days to come.Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors.

 

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