Bloomberg Daybreak: Asia Edition US Futures, Nvidia Drop After Chipmaker's Tepid Outlook
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Aug 28, 2025 David Waddell, CEO and Chief Investment Strategist at Waddell & Associates, shares insights on the recent downturn in U.S. equity futures and Nvidia's disappointing sales outlook. He discusses the implications of elevated market expectations and the challenges facing Nvidia in China. Waddell highlights how fiscal policies may shift investment strategies amidst concerns about AI chip sustainability. The conversation also touches on China's growing ambitions in AI technology and the evolving dynamics of U.S.-China tech competition.
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Expectations Drive Investment Returns
- NVIDIA's revenue outlook matched Street averages but fell short of sky-high expectations, cooling investor sentiment.
- David Waddell warns stretched expectations make even excellent results vulnerable to disappointment.
AI Rally Echoes Late-90s Fever
- The current AI-driven market rally resembles the late-90s tech fervor and appears stretched.
- Waddell says growth deceleration or CapEx slowdowns could trigger increased volatility for high-flying names like NVIDIA.
Rate Cuts Will Reroute Market Leadership
- Markets expect about a 1% Fed funds cut over the next 12 months, not the larger cuts some political voices demand.
- Waddell sees rate cuts shifting market leadership from AI winners to small caps as the cycle progresses.