11/20 U.S. stocks rise on expectations of Nvidia

11/20 U.S. stocks rise on expectations of Nvidia earnings despite consumer polarization, monetization controversy

The U.S. stock market rose mainly on technology stocks, with Alphabet (+2.82%) showing strong performance, although the announcement of Target (-2.77%) caused anxiety about the consumer economy. Of course, the process of digesting the sale continues as the wait-and-see attitude is showing a mixture of anxiety and expectations for Nvidia (+2.85%). Although interest rates and dollars were affected by the Fed’s FOMC minutes that many members are appropriate to freeze interest rates this year, the stock index is more focused on Nvidia and closes higher (Dow +0.10%, Nasdaq +0.59%, S&P 500 +0.38%, Russell 2000 -0.04% and Philadelphia Semiconductor Index +1.82%)

*Factors to Change: Concerns Over Slow Consumption, Monetization Controversy, FOMC Minutes Revealed

Recently, eBay (-0.67%), a center of used and low-priced transactions, offered a conservative outlook for the fourth quarter, Home Depot (-0.59%), which stopped spending heavily due to the housing slump the previous day, and Target (-2.77%), a middle-class consumer, suggest a frozen year-end. In addition, the National Retail Federation (NRF) announced a slowdown in the year-end shopping season, and Adobe analyzed that online sales would increase, but this would be entirely the result of relying on a “record discount rate,” suggesting that the “recession consumption pattern” has become entrenched

This proves that the U.S. economy is divided into the upper class, which enjoys asset effects, and the middle class, which is burdened by high prices. It can be said that the announcement of Target and Home Depot results indicated that the middle class’s purchasing power has reached its limit. In the end, the current U.S. consumer market has emerged as a structural risk that threatens the U.S. economy’s soft landing scenario in that most consumers, except for the wealthy, have closed their wallets. This is why changes in the stock market are important after Nvidia’s performance. If the results continue to strengthen, the impact on the economy will not be significant, but if the stock market slump expands, it could lead to a slowdown in consumption among high-income people and adversely affect the U.S. economy.

Meanwhile, the downward revision of investment opinions on Amazon (+0.06%) and MS (-1.35%) the previous day, and the case of Micron (-1.13%) today, which fell after suggesting plans to expand capital spending, show that the market’s eyes have shifted from the rosy future of AI to monetization. Nvidia (+2.85%) has been strong by absorbing capital expenditures of big techs, but companies that have to pay for them have been concerned about the market’s instability that surging infrastructure investment costs will worsen free cash flow (FCF) and undermine short-term profit margins.

The fear of such “high cost and low efficiency” is that while the huge depreciation burden that big techs have to bear within the AI industry ecosystem is increasing, the emergence of services or distinct profit models to offset it is delayed, which is why controversy over over overinvestment has spread. As a result, Alphabet (+2.82%) was evaluated as an AI-related killer app after the announcement of Gemini 3.0. In the end, companies are expected to continue to change until a definite return on investment (ROI) is proven to be a number.

In its FOMC minutes, the Fed argued that the economy is strong due to solid consumption centered on the high-income class and investment in AI-related technologies. It noted that prices were slightly above the target, but long-term expected prices were well fixed. In the meantime, many members expressed their position that it is appropriate to freeze interest rates for the rest of 2025. When these contents became known, the dollar strengthened, interest rates rebounded, and stock market sales were digested. However, the impact was limited in that it was predicted.

*Featured Stock: Nvidia Is Rising After The Market Close

Nvidia (+2.85%) rose due to the recent drop in the market. The news that key White House officials are pressuring Congress to remove provisions on China’s export restrictions from the National Defense Authorization Act also rose. After the market closed, positive news and future outlook were also reported at $637 to $66.3 billion, exceeding the $62 billion revenue forecast, with sales of $55.2 billion above expectations and data center sales exceeding $49.3 billion. The margin also rose after-hours on positive earnings reports, recording 73.6 percent. The market accepted positively, waiting for a conference call. After-hours, large tech and semiconductor companies are rising

Semiconductors: Broadcom Up Vs. AMD, Micron Down
Broadcom (+4.09%) rises after launch of Brocade X Director and G820 56-port Switch. In addition, it is also positive that major technology stocks are working with Broadcom when developing their own AI chips, and that their own chip development could expand if the monetization controversy expands. Ram Research (+3.88%) and AMAT (+4.45%) are rising, reflecting the expectation of growth of high-performance manufacturing equipment, reflecting the expectation of Nvidia’s performance. On the other hand, AMD (-2.93%) announced that it would establish a joint venture with Cisco (+1.32%) and Saudi AI startup Humane to build data centers in the Middle East, but fell. The market believes that investors’ focus on Nvidia was the impact. Micron (-1.13%) fell more than 5% when the CFO mentioned increased capital spending, but the fall was reduced, reflecting Nvidia’s performance expectations. The Philadelphia Semiconductor Index rose 1.82%

Cars: Tesla Improving Relations With Trump Vs. Electric Vehicle Industry Slump
Tesla (+0.68%) rose, reflecting the news that it has obtained driver’s permit for FSD in Arizona and the expectation of improving relations with Trump by attending a U.S.-Saudi dinner with Nvidia. In fact, the rise was made after U.S. President Trump mentioned positive remarks about Musk at the U.S.-Saudi investment forum. While electric vehicle companies such as Rivian (-1.80%) and Lucid (-3.82%) continued to fall due to concerns over a contraction in the industry, secondary battery companies were also sluggish, with Quantum Skape (-3.93%) falling on news of a downward trend. Lithium-related stocks such as Albemarle (+3.53%) continued to rise as Chinese carbon lithium prices continued to rise. Ford (-0.92%) risks battery failure