Markets Brace for Nvidia Earnings | DAX Near Oversold Zone, Trump buys Bonds

Market Summary – 19 November 2025

Nvidia Earnings Preview

• Record stakes: Options imply a ~7 % post-earnings move in Nvidia, equivalent to a USD 320 bn market-cap swing—potentially the largest single-day change ever for any company.
• Focus: Investors seek clarity on whether the AI boom is accelerating or cooling. Results are due after the US close Wednesday.
• Context: At ~USD 4.6 trn valuation, Nvidia’s report is viewed as the key sentiment driver for the AI sector this quarter.

Corporate & Sector Highlights

• Apple: Captured 25 % of China’s smartphone market in October, with iPhone 17 sales up 37 % YoY. Overall Chinese smartphone sales rose 8 % YoY.
• Google: Shares hit new highs after Berkshire Hathaway revealed a USD 4.9 bn stake, reinforcing confidence following strong earnings and resilience during the AI pullback.
• US Small Business Sentiment (BoA):
  • 74 % of small/mid-sized firms expect higher revenue next year; ~60 % plan expansion.
  • Confidence hinges on tariff stability (53 %), cooling inflation (52 %), and lower rates (52 %).
  • Profitability for small firms remains resilient in 2025.

Germany: Q3 Earnings Season

• DAX companies: Aggregate profit +2 % YoY, driven by financials, healthcare, and energy tech.
• Auto sector: Earnings –60 % YoY, offsetting broader strength; without autos, total growth would have been +15 ppt higher.
• Outlook: Analysts see –9 % Q4 profit decline, but potential rebound +14 % in 2026 as exports and sentiment stabilize.

Germany 40 Technical Analysis

The Germany 40 CFD (4H) remains in a downtrend, extending its decline after breaking below key support at 23,300. Price is now testing the 23,100–23,000 zone, aligning with the lower Bollinger Band and near the March swing low, a critical support area. The RSI (30) is deeply oversold, indicating potential for a technical rebound, though momentum remains weak. The MACD is entrenched in negative territory, confirming persistent downside pressure.

Immediate resistance sits at 23,300–23,380, with stronger supply expected near 23,750 (50 EMA). A recovery above those levels would signal stabilization, while a breakdown below 23,000 risks further downside toward 22,800–22,600. Tone: bearish trend intact, but nearing oversold rebound territory.

Federal Reserve – Rates & Liquidity

• Policy tension: Debate over a possible December rate cut continues as liquidity pressures rise.
• Repo strains: Overnight repo rates exceeding the Fed’s Interest on Reserve Balances (IORB) indicate tight bank reserves.
• Likely response: Market expects the Fed to expand its balance sheet from Jan 2026, adding USD 20 bn/month in T-bills and USD 15 bn/month in MBS reinvestments to prevent year-end repo stress.
• Short-term relief: Treasury’s general account drawdown (~USD 100 bn) and Standing Repo Facility (SRF) usage should temporarily ease pressure.
• Key focus for December FOMC: not only rates, but also liquidity-management guidance.

US Tariffs & Trade

• Food imports: Tariffs cut on coffee, bananas, tomatoes, beef, reducing the average agricultural duty 13.0 % → 10.3 %.
• Swiss goods: Tariffs reduced 39 % → 15 %; Switzerland pledges USD 200 bn US investment (mainly pharma) by 2028.
• Growth impact: Lower tariffs could lift Swiss GDP +0.3–0.5 ppt annually from 2026; CHF strength (0.918/EUR) remains a drag.

Rare Earths & Brazil

• Brazil–US partnership talks: Brazil, holder of the world’s second-largest rare-earth reserves (21 mt), aims to boost output from 20 t to rival China’s 270 t.
• Sector outlook: Brazilian mining P/E 7.1 vs China 13.0—seen as undervalued; new cooperation could diversify US supply chains away from China.

US Real Estate

• Commercial rebound: Q3 2025 transactions +17 % YoY, driven by multifamily, logistics, and data-centre assets.
• Catalyst: September’s 25 bp Fed rate cut improved sentiment; investors favour income-producing, inflation-resilient assets.

Trump’s Portfolio Disclosure

• Total new investments: ≥ USD 82 mn (Aug–Oct), spanning corporate and municipal bonds.
• 175 transactions filed under federal ethics rules.
• Corporate bonds purchased: Broadcom, Qualcomm, Meta, Intel, Home Depot, CVS, Goldman Sachs, Morgan Stanley, JPMorgan.
• Strategic link: Intel bond purchase followed government stake acquisition under Trump’s direction, prompting scrutiny over overlap.
• Theme: Positions align with domestic manufacturing, tech independence, and infrastructure priorities.