Nvidia earnings and Anthropic's $1.4tn IPO to test AI trade
Nvidia's fiscal third-quarter results on Tuesday and Anthropic's stock market debut will give investors their clearest test yet of whether the AI trade still holds. Analysts polled by LSEG expect Nvidia to report earnings growth of around 90% on revenue of approximately $109 billion.
The chipmaker's valuation has fallen from about $5.8 trillion in early October to $3.9 trillion as of Friday, LSEG data showed, with its shares under pressure amid controversies surrounding chief executive and co-founder Jensen Huang. Investors will focus on its outlook for AI-related spending and demand for its advanced chips.
Anthropic, developer of the Claude chatbot, is expected to open its IPO on Wednesday, with shares likely to begin trading on Thursday. The offering is expected to be priced at $70-$78 per share; at the top of that range the company could command a fully diluted valuation of approximately $1.4 trillion. Its investors aim to raise as much as $64.4 billion from the sale of 825 million shares.
The listing lands as confidence in the AI trade has become more uncertain, with questions over whether the enormous capital expenditure by technology companies on AI infrastructure can generate sufficient returns. Political developments have added to regulatory uncertainty around the expansion of AI data centres.
On the economic front, Federal Reserve Chair Kevin Warsh speaks on Monday, US retail sales data land on Tuesday and the minutes of the Federal Open Market Committee's October meeting follow on Wednesday. Expectations of another Fed rate increase in December have strengthened after stronger-than-expected employment figures and higher-than-anticipated inflation. Earnings from Walmart, Home Depot, Target, Walt Disney, Palo Alto Networks, Alibaba, Baidu and XPeng are also due.
