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Rising Inflation, Tech Earnings Impact, and Debt-Ceiling Negotiations: A Turbulent Financial Landscape Unfolds

Rising Inflation, Tech Earnings Impact, and Debt-Ceiling Negotiations: A Turbulent Financial Landscape Unfolds

Unpacking the week's major economic and tech industry shifts, and what they could mean for your portfolio

Justin Oh
May 26, 2023

The Fed seems less certain 🤔 on the future of rate hikes, as Nvidia's earnings benefit AMD but hurt other chipmakers like Intel 💻. Meanwhile, inflation appears to be on the rise ⬆️, JPMorgan is working on an AI service that offers investment advice 🤖💡, and a potential deal on the debt ceiling is starting to form as the deadline approaches ⏰.

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Interesting Headlines

Fed officials less confident on the need for more rate hikes, minutes show

The Federal Reserve on Wednesday released minutes from its May 2-3 policy meeting.

www.cnbc.com/2023/05/24/fed-officials-less-confident-on-the-need-for-more-rate-hikes-minutes-show.html

Nvidia's blowout earnings lift AMD while other chipmakers such as Intel fall

Nvidia's stock performance has been a boon for some names but has sent shares of conventional CPU manufacturers such as Intel down in Thursday trading.

www.cnbc.com/2023/05/25/nvidia-earnings-lift-amd-while-other-chipmakers-like-intel-fall.html

Inflation rose 0.4% in April and 4.7% from a year ago, according to key gauge for the Fed

The core personal consumption expenditures price index was expected to increase 0.3% in April, according to a Dow Jones estimate.

www.cnbc.com/2023/05/26/inflation-rose-0point4percent-in-april-and-4point7percent-from-a-year-ago-according-to-key-gauge-for-the-fed.html

JPMorgan is developing a ChatGPT-like A.I. service that gives investment advice

Banks including Goldman Sachs and Morgan Stanley are testing A.I. internally, but JPMorgan may be the first to release a GPT-like product directly to customers.

www.cnbc.com/2023/05/25/jpmorgan-develops-ai-investment-advisor.html

Potential Debt-Ceiling Deal Starts to Take Shape as Deadline Looms

Negotiators consider more money for military and cuts to IRS funding, though nothing has been finalized.

www.wsj.com/articles/potential-debt-ceiling-deal-starts-to-take-shape-as-deadline-looms-c1c3b8f5?mod=hp_lead_pos1

Interesting Tweets

AI winners, losers and tweeners
— 1 Main Capital (@1MainCapital)
1:35 PM • May 23, 2023

$AMD and $INTC Q1 prints signaled decelerating hyperscaler capex, but what may be occurring is a hardware shift to more GPU intensive workloads from more CPU intensive in the data center, given the advent of generative AI. However, $NVDA's inventories have raised red flags.
— Not Tiger Global (@NotChaseColeman)
11:56 AM • May 24, 2023

Seen on WSB: "Soft Landing Achieved"
— Market Rebellion (@MarketRebels)
6:43 PM • May 25, 2023

Periods of max disruption like the dawn of internet, mobile & AI cause a natural tension. It can be BOTH true: (1) machine augmented intelligence / AI will have massive impact on humanity AND (2) most early AI experiments / businesses will fail. We thrive bc we accept that risk.
— Brad Gerstner (@altcap)
3:52 PM • May 26, 2023

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Disclaimer: This newsletter's content is not investment advice and doesn't express any opinion about potential security prices. Make decisions based on your own review of publicly available information, not solely our content.

Our information, prepared from public sources and our research, might not be fully accurate or complete. Our views can change without notice and are based on assumptions, not actual events. Other unforeseen events may impact securities' performance.

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