Markets keep sailing despite Tariff crosswinds, NVIDIA rockets past $4 trillion high water mark

The market’s compass stayed fixed on growth as heavyweight techs towed equities through the fog of trade uncertainty. Nvidia’s surge past the $4 trillion mark gave bulls fresh ballast, even as President Trump’s latest tariff broadsides threatened to churn the waters. Like the biggest ship in the flotilla, Nvidia cut through the early-year chop under full sail—fueled not by hype, but by hard demand, locked-in chip orders, and the relentless pull of AI infrastructure spend.

The S&P 500 edged closer to record shores, with the megacap tide lifting most index boats. Even a new round of Trumpian trade threat letters — this time aimed from Baghdad to Manila — couldn't capsize the mood. Traders shrugged, markets yawned, and the tariff headlines continue landing more like a drizzle than a downpour. Brazil’s real took the brunt of Trump’s ire, but in equities, it was another day of drift and grind higher.

Under the surface, however, the bond market found its sea legs. A solid $39 billion 10-year auction offered a lifeline, snapping a five-day Treasury selloff and pulling yields back down to 4.34%. The bid-to-cover was tight, but the message was clear: for now, demand for duration remains intact — especially with the Fed’s next move still wrapped in fog.

The Fed minutes added nuance, revealing a committee torn on tariffs’ inflation impact. Some see a one-time flare-up; others worry about more stubborn embers. But for traders, the takeaway was simple: the Fed isn’t blinking yet. And with inflation still sticky and growth not collapsing, the bar for a near-term cut remains high.

Meanwhile, fast money — after playing it coy for months — is creeping back into the pool. BNP Paribas’ positioning metrics suggest hedge funds and systematic players are lifting their toes off the brake, moving toward neutral and eyeing risk again. With the S&P perched at cycle-high valuations and sentiment measures like CNN’s Fear & Greed Index flashing “full steam ahead,” the melt-up mentality isn’t quite dead — just more cautious.

Still, the next test is coming fast. Earnings season looms, and while technical tailwinds have propelled the rally, the handoff to fundamentals could get messy. The tape’s resilience is undeniable, but as we saw in 2023, even bull markets can stumble if the narrative changes. Tariffs, tech blowups, or inflation surprises — any of these could jolt the autopilot.

For now, however, Nvidia’s vertical lift-off remains the story. AI dreams have papered over macro cracks, at least for today. But the market’s tolerance for headline noise may soon be tested as valuations float ever higher, and gravity, eventually, gets its say.

FOMC Minutes – Don’t rush, don’t blink

The June Minutes read like a central bank steering with one hand on the wheel and one eye on the horizon—cautious, watchful, and in no hurry to lean forward. The Fed sees the tariff smoke, but it hasn’t called the fire brigade yet. Inflation uncertainty loomed large in the discussion, with a clear divide: a few saw tariffs as a one-off flare-up, but most warned of stickier, more persistent pressure. It’s not a panic—but it’s not a shrug, either.

No one dissented on the June hold, marking the fourth straight meeting without movement. But a couple of members cracked the door open for a July cut—no shock, given recent dovish hums from Waller and Bowman. Still, the prevailing rhythm remains slow and deliberate. Most on the Committee still expect some easing this year, just not at a sprint.

The takeaway? The Fed’s not chasing shadows. It’s sitting tight, waiting for the fog of trade policy to clear. September remains the likeliest inflection point, barring a data curveball. Until then, Powell & Co. are content to keep their powder dry and their options open.

Nvidia tops $4 trillion: The AI engine that refuses to stall

Nvidia has just crossed the $4 trillion finish line, leaving the rest of the tech pack eating its silicon dust. It’s a moment dripping with symbolism—Silicon Valley's ultimate chipmaker now wears the crown once reserved for consumer titans. From $1 trillion in mid-2023 to $4 trillion today, the rise hasn’t just been exponential—it’s been parabolic, turbocharged by an AI boom that makes the dotcom era look quaint.

What’s driving it? A potent cocktail: Trump’s trade détente with China cracked the ice, while sovereign wealth deals across the Middle East and Europe poured rocket fuel into the engine. But it’s Nvidia’s core dominance in AI compute that’s kept the wheels spinning. When Big Tech wants to build brains, they call Jensen.

CEO Jensen Huang has built a semi-religious cult around AI, and investors are lapping it up. His May earnings call was a sermon: robotics, AI, trillion-dollar TAMs—and the chips to power them all. With 70% quarterly revenue growth and a forecasted $200bn top line this year, Nvidia isn’t just riding the AI wave—it’s building the damn pipeline.

Even a brief stumble earlier this year—triggered by Chinese upstart DeepSeek and tariff worries—proved to be little more than a pit stop. Now, as US and global demand re-accelerates and GPU supply chains normalize, Nvidia’s margins remain regal: over 70% gross and $105bn in forecasted net income. The fact that insiders just unloaded $1bn in stock barely made a dent—when you’re up 40% since May, a little profit-taking is just part of the scenery.

The real story here is durability. Nvidia has become the linchpin of AI infrastructure—the rails on which this entire tech transformation rides. While others build the apps, Nvidia prints the shovels. It’s no longer just about ChatGPT—it’s about every cloud provider, every LLM lab, and every sovereign AI stack looking to future-proof their digital backbone.

This isn’t Nvidia as a stock. It’s Nvidia as an AI standard. And unless something upends the very trajectory of compute—this train still has steam.