The upcoming week promises to be eventful for global markets, with key events including the release of the US Federal Reserve's October meeting minutes, Japan's October CPI report, and Nvidia's third-quarter earnings. Nvidia, a Nasdaq-listed AI infrastructure company, is anticipated to report fiscal third-quarter 2027 revenue growth of 91.3% to $109bn, with earnings increasing by 90.3% to $2.47 a share. However, gross margins are expected to decline slightly to 74.1% from 75% in the previous quarter. The company's stock is currently breaking through support around $165, with potential to fall to $140, but oversold conditions suggest a bounce or consolidation may occur.
The sudden departure of Nvidia's CEO Jensen Huang adds uncertainty to the earnings report. Options positioning is heavily bearish, with call open interest concentrated at $200 and put open interest at $150. While options hedging flows could push the stock higher post-earnings, the CEO's exit may mute this effect.
The Federal Reserve's October meeting minutes will provide insight into policymakers' decision to hold rates steady, despite recent strong jobs and inflation data. Markets are pricing in a December rate hike, and a hawkish read of the minutes could strengthen the dollar and weigh on EUR/USD, which is testing support at $1.105. A break below this level could signal a steeper decline.
In Japan, inflation is expected to accelerate to 2.6% year-on-year in October, up from 2.1% in September. This could pressure the Bank of Japan to hike rates in December, despite mixed odds. USD/JPY is breaking out of a bullish continuation pattern, potentially pushing it towards ¥160 and threatening a rise to ¥164.