0825 | Nvidia's Hyperscaler Dependence Faces Big Test; Chip Stocks Rebound; Bessent's Bond Plan

Mia: You're listening to After Market on Bri Radio. I'm Mia, joined by Milo. Chip stocks were bouncing back a day before Nvidia's big earnings report. Also on the tape, Treasury Secretary Scott Bessent's surprise move to expand bond buybacks, and a rough day for several big names ahead of Nvidia's numbers.

Milo: And later, oil dropped sharply after the U.S. shifted to economic pressure on Iran, while bitcoin touched its highest level in months.

Mia: Chip stocks were leading the bounce one day before Nvidia's earnings report, due Wednesday night. On the same tape, the Dow rose while Treasury yields fell, and Nvidia, Micron, and Sandisk each rallied. Separately, futures on the Dow Jones, the S&P 500, and the Nasdaq set Wall Street up to open higher as crude oil extended a sharp retreat.

Milo: So all of this rally is happening with the earnings outcome still unknown, then.

Mia: Exactly. Nvidia's results had not been released as of these reports, so what the numbers show remains an open question. The scheduled next development for the chip group is the report Wednesday night.

Mia: The stakes around that Nvidia report are unusually big, because the company is leaning on a fairly narrow base. Nvidia is trying to expand its customer base by creating new financing options that would let more clients purchase its costly systems.

Milo: And that dependence on a handful of big cloud buyers is exactly what investors are watching. Franklin Templeton's Sara Araghi said Nvidia needs to go beyond a headline earnings beat and actually give investors concrete detail on how it plans to deploy capital and sustain its spending plans.

Mia: So a beat on the headline number may not be enough — the ask is for a clear map of what comes next.

Milo: Treasury Secretary Scott Bessent's surprise plan to dial down U.S. borrowing costs by expanding bond buybacks has already produced measurable market effects. U.S. long bonds have seen a short squeeze, and Bloomberg Markets describes the pattern as the Bessent Put at work, with key metrics and positioning showing the intervention is having an impact, including a modest decline in yields.

Mia: Whether that ultimately works is fiercely debated. Stanley Druckenmiller — Bessent's own mentor — calls the bond buying a mistake and expects the ploys to fail. And Dan Suzuki, global investment strategist at iCapital, said on Bloomberg Surveillance that the Treasury's recent attempts to lower long-term yields are insufficient and largely symbolic, and that the Fed will have to start hiking rates at some point. So the unresolved question is whether those measures will be enough — with critics saying they are not.

Mia: Separately, Treasuries also gained as an oil drop eased pressure on inflation.

Milo: With Nvidia earnings looming, it was a rough session for some big names. Intuit shares sank eleven percent on a weak outlook.

Mia: And Dick's Sporting Goods fell harder — twenty five percent — after the retailer reported fiscal second-quarter earnings on Tuesday that missed Wall Street expectations, in what the company called a challenging footwear market.

Mia: Oil dropped three percent after the United States shifted to economic pressure on Iran, easing fears of a renewed war. Investors are reported to have shrugged off the latest developments in the U.S.–Iran situation, because the plan seemed less likely to affect physical supply than they expected. That's the key nuance — the price move reflected expectations that physical impact would be limited, but the plan's actual effect on supply remains unproven.

Mia: U.S. natural gas futures ended lower but pared back most of their losses, after earlier being pulled down by crude oil and European gas futures. Separately, Ukrainian drone strikes around the Black Sea are hampering oil flows from the Russian port of Novorossiysk, while crude processing tumbles.

Milo: And as a next signal, Bloomberg reports Russia is considering extending its diesel-export ban amid the Kyiv attacks.

Milo: In crypto, bitcoin opened Tuesday at its highest level in more than three months and briefly topped eighty-one thousand dollars, extending a rally that one report said was gathering pace, with renewed inflows into spot bitcoin ETFs and improving risk appetite cited as the drivers. Whether bitcoin held above eighty-one thousand dollars isn't established, since the move was reported as brief.

Mia: Gold also hit a three-month high on the same morning, and the U.S. dollar was described as fragile as investors weighed Iran sanctions and Treasury buybacks. One report framed the mood as the return of the debasement trade after the Bessent bond maneuver, saying crypto and gold are back in style — though that remains the source's interpretation rather than a reported market fact.

Milo: So it all circles back to Nvidia tonight — a seven-day slide in the chips with the earnings outcome still unknown, and all eyes on the report Wednesday.

Mia: Right, the chips led a higher close with yields slipping and oil sliding, and the next big shoe to drop is Nvidia. Thanks for listening.

Milo: Thanks for having us — that's all for now.