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Tech Rally Pauses Ahead of Nvidia Earnings, Fed Minutes in Focus

U.S. stock index futures barely budged in the Monday evening shuffle, as Wall Street’s enthusiasm for tech stocks took a breather. The tech-fueled rally that catapulted the Nasdaq to record highs faced a speed bump ahead of Nvidia’s eagerly awaited earnings report.

Interest rate jitters lingered, with Federal Reserve officials persistently hinting at sticky inflation. The market’s collective ear is tuned to Wednesday’s release of the central bank’s late-April meeting minutes.

By 19:20 ET (23:20 GMT), S&P 500 Futures held steady at 5,331.0 points, while Nasdaq 100 Futures inched down 0.1% to 18,748.50 points. Dow Jones Futures also dipped 0.1% to 39,923.0 points.

Tech flexes muscles before Nvidia earnings

Nvidia Corporation (NASDAQ: NVDA), the market’s beloved tech titan, is set to unveil its quarterly earnings after the closing bell on Wednesday. All eyes are on whether it can deliver the exponential earnings growth the market craves.

Nvidia, a key player in the booming AI industry, has been the poster child for skyrocketing tech valuations over the past year. Anticipation for its earnings bolstered tech stocks, pushing the NASDAQ Composite to a new high on Monday, outpacing its Wall Street comrades.

Nvidia surged 2.5%, nearing its own record. Compadres Advanced Micro Devices Inc (NASDAQ: AMD) and Intel Corporation (NASDAQ: INTC) also saw gains, up 1.1% and 0.9% respectively, continuing to climb in after-hours trading.

Tech giants Apple Inc (NASDAQ: AAPL), Microsoft Corporation (NASDAQ: MSFT), and Alphabet Inc (NASDAQ: GOOGL) advanced between 0.4% and 1.3%.

The S&P 500 ticked up 0.1% to 5,308.13 points, while the NASDAQ Composite jumped 0.7% to a record 16,794.87 points on Monday. Meanwhile, the Dow Jones Industrial Average lagged, slipping 0.5% to 39,806.77 points.

Fed cues keep markets on their toes

Market nerves were taut ahead of more Fed insights this week, particularly from the minutes of its latest meeting and speeches from several officials. Despite a slight easing in April’s consumer inflation figures, Fed voices cautioned that more proof of taming inflation is needed before rate cuts are on the table.

Richmond Fed President Tom Barkin and New York Fed President John Williams, both on the Fed’s rate-setting committee, are scheduled to speak on Tuesday.

The central bank might start trimming rates by September, but much hinges on the inflation trajectory.

Chesapeake Energy Lays Off Employees Amid Strategic Shifts and Merger Maneuvers

Chesapeake Energy (NYSE:CHK), one of the U.S.’s top natural gas producers, started handing out pink slips this week after unloading its oil assets last year, the company announced Monday.

These layoffs are tied to its exit from the Eagle Ford (NYSE:F) assets, not the impending merger with Southwestern Energy (NYSE:SWN), Chesapeake clarified, perhaps hoping to quell any rumors of merger-related jitters.

While mum on the specifics of the layoffs, Chesapeake has been clear about its strategic pivot. In 2022, the company bid adieu to the Eagle Ford shale field in South Texas, cementing its status as a pure-play natural gas producer.

Earlier this year, it sold some of those assets to INEOS Energy for a cool $1.4 billion, and wrapped up the divestiture by offloading the rest to SilverBow Resources (NYSE:SBOW) for $700 million.

Based in Oklahoma City, Chesapeake is also tying up a $7.4 billion merger with Southwestern Energy, scheduled to finalize in the latter half of this year, a bit delayed after the U.S. Federal Trade Commission asked for more info.

Natural gas producers like Chesapeake have been feeling the heat this year with prices tanking by about 20% in Q1 due to bloated inventories and weaker-than-expected demand. Missing Wall Street profit estimates, Chesapeake and others have been dialing back production in response.

In a shakeup accompanying the merger, Chesapeake will swap out its General Counsel Benjamin Russ for Southwestern’s Chris Lacy, as per a regulatory filing on May 7.

Investing on a Tuesday is like tiptoeing through a minefield with a bouquet of roses. The market might reward you with a sweet-smelling gain, or it could blow up your portfolio with a surprise earnings miss. Just remember, while Mondays set the tone and Fridays bring the grand finale, Tuesdays are when the real drama unfolds – a tantalizing mix of anticipation and anxiety that keeps every investor on their toes. So, hold onto your hats and your sense of humor, because in the world of finance, Tuesday is where the plot thickens.