Nvidia Report Could Spur Market Gains As Trump, Musk Shake Up Federal Workforce

A turning point may be approaching after the S&P 500 recorded its fourth consecutive decline.

Nvidia is the biggest beneficiary of the AI boom, its shares surging 63% over the past year. I Photo: NVIDIA Asia Pacific Facebook

Despite the dip, more stocks rose than fell on the day, with Big Tech leading the index lower. Concerns are growing that optimism surrounding artificial intelligence (AI) as a driver of earnings growth has peaked, Brian Swint reported for Barron’s Daily.

Wednesday could bring fresh momentum to AI-related stocks.

Nvidia—the biggest beneficiary of the AI boom, with its shares surging 63% over the past year—reports earnings after the bell.

While a strong quarter could reignite investor enthusiasm for AI, expectations are sky-high, making it challenging to deliver a true surprise. Meanwhile, consumer confidence took a hit.

The Conference Board’s confidence index, released Tuesday, saw its sharpest drop since 2021 as shoppers grew increasingly anxious about inflation, job security, and income prospects.

Trump’s new tariffs and Elon Musk’s aggressive push to cut government jobs are fueling these concerns. The speed and severity of the federal job reductions are unsettling even private-sector workers.

These economic worries are particularly evident in the bond market, where yields have dropped to their lowest levels of 2025.

Traders are now pricing in two quarter-point Federal Reserve rate cuts this year, up from the previously expected single cut. While markets may recover, the current environment suggests it might be time for investors to adopt a more defensive strategy.