NVDA Met Expectations but the Market Wanted More — London Opens With a Question

S&P 500

7,432.97

+1.08% Wed

Dow Jones

50,009

+1.31% — Crossed 50K

Russell 2000

2,817

+2.56% — Led the board

VIX

17.44

-3.43% — Still elevated

Fear & Greed

65

Greed — up from ~60

Crude Oil

$99.15

$100 level in sight

Asia digested two things simultaneously overnight: NVDA’s post-close result and the continued overhang of hawkish FOMC minutes. The outcome is what you’d expect when expectations aren’t fully met — a restrained session rather than a clean trend day in either direction.

Early indications from Asian futures and cash markets suggest the Nikkei 225 (NI225) traded cautiously. Japan sits in an unusual position: a domestic bond market at a decades-high (JGB 10Y hit 2.80%), a currency sitting at 158.96 against the dollar, and a tech-heavy index that wanted NVDA to blow the doors off. It didn’t. The Nikkei likely saw limited upside and potential defensive rotation into domestic names. Watch whether USD/JPY holds 158 — a break below drags Nikkei with it.

The Hang Seng (HSI) entered the session with its own China recovery narrative intact, but NVDA export control concerns remain a background risk for mainland AI stocks. Hong Kong’s tech complex would have found it difficult to sustain momentum with NVDA trading down 1.26% in after-hours. Early indications point to a mixed-to-flat Hang Seng, with property and domestic consumption names possibly providing a partial offset.

The ASX 200 (XJO) tends to track Wall Street’s move with a lag. Given the S&P closed up 1.08%, Australian equities likely opened with modest gains — but the commodity overlay matters. Crude approaching $100 is inflationary noise for the RBA’s calculus, and Gold holding its safe-haven bid keeps Gold miners supported. Resources and energy would have been the brighter spots overnight.

Note: Asian session data is based on projected reactions from overnight inputs. Verify live quotes at your broker before acting.

These are direct verdicts against the calls published in Wednesday’s Post-Close brief and Pre-Asia.

Honest assessment: the caution bias on equities missed a strong session. The NVDA long worked intraday. The Gold short did not. That’s a reminder that correlations break during late-stage risk rallies — Gold can rally alongside equities when inflation anxiety is the underlying driver.

Opportunity Watch

Russell 2000’s +2.56% outperformance is the real story. Small caps don’t lead unless institutional money is rotating out of mega-cap concentration risk. If that rotation continues, European mid-caps and cyclicals benefit at London open — watch FTSE 250 (MCX) more than FTSE 100 this morning.

Risk to Watch

Dow crossing 50,000 is a round-number magnet for profit-taking. European traders often use US milestone levels as sell triggers. The FTSE 100 (UKX) has a heavy weighting in energy and mining — if Crude fails $100 and retreats, FTSE underperforms DAX this morning. Separately, WMT earnings before open could reshape the consumer staples narrative globally.

FTSE 100 (UKX) — The index has a structural advantage from Crude near $100, given the weight of BP (BP.), Shell (SHEL), and the broader miners. However, if WMT disappoints this morning, staples sell off globally. FTSE’s Unilever (ULVR) and Diageo (DGE) would take the first hit. Expect FTSE to underperform DAX unless energy holds up at open.

DAX 40 (DAX) — Germany’s index is more sensitive to EUR/USD. At 1.1624 the euro is elevated against the dollar, which compresses export earnings for BMW (BMW), Volkswagen (VOW3), and BASF (BASF). The auto sector enters London with a headwind. Tech-adjacent names like SAP (SAP) get a partial offset from the AI narrative NVDA kept alive, even if it didn’t blow the doors off.

Euro Stoxx 50 (SX5E) — The broader European index captures both dynamics. Watch the financial sector here — BNP Paribas (BNP), Societe Generale (GLE) — as bond yields staying high is a net positive for bank net interest margins, but it’s also raising sovereign debt cost concerns in France and Italy.

NVDA (NVDA) pre-market context — Trading around $220.66 post-close, down from $223.47. Guidance was $1.93-$2.10 EPS against a consensus of $1.94. “Par” was the word used on the call. European chip-adjacent names like ASML (ASML), which supplies the lithography equipment NVDA’s manufacturers depend on, tend to shadow NVDA’s sentiment. If NVDA opens flat to down, ASML could see early pressure at Amsterdam open.

EUR/USD (1.1624, +0.14%) — The dollar held a small bid (DXY 99.18, +0.07%) despite the equity strength, which tells you risk appetite isn’t fully dollar-negative. The euro is approaching its recent range top. For London traders: if Eurozone PMIs or any commentary from ECB speakers disappoint, this pair offers a short from current levels with tight risk back toward 1.1650. The upside target above 1.1650 is 1.1700, but that requires fresh dollar weakness or stronger EU data.

GBP/USD (1.3428, +0.24%) — Sterling continues to outperform the euro. UK-specific flows are helping — the BoE has been less hawkish than the Fed but more hawkish than the ECB. Cable at 1.3428 is a level to watch for short-term longs. The next resistance sits near 1.3480. If you’re long, your stop belongs below 1.3380.

EUR/GBP — With GBP outperforming EUR on both sides of the Atlantic, EUR/GBP is grinding lower. This is worth watching around 0.8650 — a break confirms sterling’s relative strength into the European session and gives a cleaner short setup on the cross. London hours are typically the deepest liquidity window for this pair.

USD/JPY (158.96, -0.05%) — The JGB 10-year hitting 2.80% (an all-time high) is the most important thing happening in rates right now, and it’s not getting the attention it deserves. When Japanese yields rise, Japanese investors repatriate overseas capital — which is yen-positive, dollar-negative. USD/JPY at 158.96 is under structural pressure. A clean break below 158.00 accelerates that move. If that happens during London hours, it cascades into risk — the carry trade unwinds, and European indices follow equities lower.

30Y US Treasury (5.19%) — Not a tradeable FX pair, but the context it sets for everything above matters. 5.19% on the long end with FOMC hawkish minutes means the cost of capital isn’t coming down this year. That’s a headwind for growth stocks, a tailwind for financials, and a drag on rate-sensitive sectors like real estate and utilities globally.

* European index prices are indicative based on US close + futures. Verify at your broker before acting. Entries are zones, not exact fills.

WMT is the one that moves markets. Walmart is a proxy for the US consumer — if they talk down discretionary spending, staples may paradoxically sell off on margin concerns and growth stocks get sold harder. Watch for guidance commentary, not just the headline beat.

Risk today: approximately 65%. Factors: NVDA disappointment hangover, Dow 50K psychological resistance, WMT print unknown, USD/JPY JGB structural pressure, COT showing heavy short positioning in S&P that can flip fast in either direction. This is not a day to be greedy — the setup is for reactive trading off confirmed levels, not anticipatory positioning ahead of data.

If you want the full Wednesday context that feeds into today’s read, the following briefs are available for members:

• Wednesday Pre-London (20 May) — Set up the NVDA long thesis at 218.50-220.00 and mapped the VIX/Greed divergence
• Wednesday Pre-Asia (20 May) — Two-scenario NVDA analysis: Scenario A (beats, 55%) vs Scenario B (disappoints, 30%). Today we got the scenario that wasn’t modelled — a middle ground meet-and-maintain.
• Wednesday Post-Close (20 May) — FOMC minutes digest and the COT divergence deep-dive. The short squeeze thesis originated here.

Each brief builds on the prior session’s read. Reading them in sequence gives you the full picture of how today’s setup developed over 48 hours.

* Indicative prices. Verify live quotes at your broker.