In a Monday note, Lee highlighted that Nvidia's earnings report after the market close on Wednesday and Federal Reserve Chairman Jerome Powell's speech at Jackson Hole on Friday represent big market-shaking catalysts that could spark a surge in stock prices.
"Stocks risk/reward has shifted positively this week. The key will be the direction of interest rates but we see positive catalysts emerging at the end of this week," Lee said. For Nvidia, investors are eagerly awaiting its second-quarter earnings results three months after the companyLee expects good news from the company.
"We know Nvidia is going to have good results. We just know that they're selling every chip they produce," Lee said in a video update to clients. Lee expects the company to provide assurance to investors about the fast-growing artificial intelligence market, and that could help spark a rebound in technology stocks.
The second catalyst investors should watch this week is Fed Chair Jerome Powell's speech at Jackson Hole on Friday, which comes amid a renewed surge in interest rates. The 10-Year US Treasury rate is currently above 4.30%, its highest level in more than 15 years, while the average"We think the Fed is likely somewhat bothered by the rise in 10-year yields. This represents a meaningful tightening in financial conditions and threatens to push mortgage rates higher," Lee said.