CRYPTO FUNDING BOOM
Venture capital funding for crypto companies skyrocketed to $2.4 billion in the first quarter of 2024, marking a rebound in investor interest. This surge follows a peak of $11.1 billion in early 2022 and a subsequent decline to $1.7 billion in late 2023. Despite past setbacks such as crypto firm bankruptcies, some analysts remain upbeat about the industry’s potential for growth and innovation. Let’s remember that recent regulatory approvals, notably for exchange-traded funds tied to bitcoin, have restored investor confidence and sparked newfound optimism. As a result, Bitcoin itself has staged a remarkable recovery, hitting a record high of $73,803.25 in March 2024, and although its performance has been somewhat erratic since then, it is still worth noting that the resurgence in crypto investment activity could be hinting at a more promising future for the industry.
BULLISH PRICE BOOST
Leading up to NVIDIA’s earnings release on May 22, analysts from Barclays, Baird, and Stifel have raised their price targets for the stock, indicating positive expectations for the company’s upcoming performance. Barclays maintained a Neutral rating but increased its target to $1,100, foreseeing substantial revenue upside in April and July due to favorable market trends. Similarly, Baird upgraded its target to $1,200, emphasizing NVIDIA’s strong position in AI-related demand and projecting significant growth in GPU unit shipments for this year and beyond. Stifel raised its target to $1,085, anticipating another round of strong results driven by ongoing AI infrastructure investments. Analysts are highly optimistic about NVIDIA’s future prospects and the potential for sustained growth, particularly as the company continues innovating in the AI space and expanding its product offerings. Market analysts, such as Morgan Stanley, share this positive sentiment, highlighting investors’ growing enthusiasm for NVIDIA’s forthcoming products and growth trajectory, underpinning the anticipation for another impressive quarter from the tech giant.
OPTIMISTIC REVERSAL
Morgan Stanley has shifted their pessimistic stance on U.S. stocks to a more positive outlook. Initially predicting a significant 15% decline in the benchmark S&P 500 by December, they now anticipate a 2% increase by June 2025. This change in forecast places their target of 5,400 points among the higher projections on Wall Street, indicating a potential record high for the index. The bank is optimistic about the future of U.S. stocks, citing expectations of robust earnings growth and stable economic conditions in the upcoming months. Nonetheless, it is very important to remark that while this shift in sentiment suggests a more favorable market trajectory, there are still bearish views among some analysts at Wall Street. Thus, the bank suggests investors to consider a balanced approach by investing in quality cyclical and growth stocks, while Fed Gov Christopher Walleralso maintaining exposure to defensive sectors such as consumer staples and utilities as a precautionary measure.
SHINING INCREASE
Gold prices are on the rise due to several factors, including increased central bank purchases, strong demand from Asian markets – particularly China, and growing geopolitical tensions in regions such as Ukraine and the Middle East. Spot gold saw a 1.2% increase, reaching $2,442.92 per ounce. In addition, silver prices have also climbed, hitting their highest level since December 2012. The recent surge in silver prices was supported by positive sentiment across the physical metals markets, as supply constraints have fuelled investor interest in materials like copper. Meanwhile, platinum and palladium prices remained relatively stable during this period.
KEY EVENTS HAPPENING THIS WEEK
Monday: Speeches from Fed Gov Christopher Waller and Fed Vice Chair Philip Jefferson, and earnings reports from Palo Alto Networks and Zoom Video (after market closes).
Tuesday: Speeches from Fed Gov. Christopher Waller, New York Fed President John Williams, Fed Vice Chair for Supervision Michael Barr, Cleveland Fed President Loretta Mester, Atlanta Fed President Raphael Bostic and Boston Fed President Susan Collins, and earnings reports from Lowe’s and Macy’s (before market opens).
Wednesday: Existing home sales report for April, minutes of Fed’s May FOMC meeting, and earnings reports from Target, TJX Companies (befor market opens), Nvidia and Snowflake (after market closes).
Thursday: New home sales report for April, initial jobless claims for week ending on May 18, S&P flash U.S. services and manufacturing PMI reports for May, speech from Atlanta Fed President Raphael Bostic, and earnings reports from Workday (after market closes).
Friday: Durable-goods orders and dlurable-goods minus transportation reports for April, final consumer sentiment report for May, speech from Fed Gov Christopher Waller.
