The Market Today
June CPI dropped 0.4 pct month-over-month, double the expected decline, pulling the annual inflation rate to 3.5 pct, well below the 3.8 pct forecast and the 4.2 pct May reading. Core CPI was flat on the month and ran 2.6 pct annually against a 2.9 pct consensus. Energy slumped 5.7 pct, its biggest monthly drop since April 2020. Treasury yields fell sharply. Stock futures went green. Fed Chair Kevin Warsh made his congressional debut before the House Financial Services Committee this morning, pledging to defeat inflation without giving any forward rate guidance. Most notably, he singled out AI data center buildout as the "most striking feature" of the current U.S. economy. Market-implied odds of a July hike dropped on the softer print; September hike probability fell to 63 pct from above 75 pct. Crypto led the risk-on move: Bitcoin (BTC) +2.3 pct to $63,945, Ethereum (ETH) +5.4 pct to $1,868, Chainlink (LINK) +4.8 pct to $8.31.
Existing Positions
NVIDIA Corp. (NASDAQ:NVDA), HOLD
NVDA opened Tuesday at $207.57, bouncing from Monday's close of $203.53. Today's soft CPI is exactly what this trade needed: lower yields re-rate long-duration AI earnings upward. Fed Chair Warsh calling out AI and data center buildout in front of Congress is a direct endorsement of NVDA's total addressable market. My thesis, that NVDA is the only platform running every frontier AI model and that demand has gone parabolic, remains fully intact. The analyst consensus price target sits at $301.62, implying 48 pct upside from current levels. Bank earnings hit tomorrow before the open (JPMorgan, Goldman Sachs, Bank of America, Wells Fargo, Citi), and strong results would validate continued AI capex from financial institutions, a key driver of NVDA revenue. Stop at $182, target $265 into Q2 earnings on August 26. Currently sitting -4.83 pct below my $218.09 average, but comfortably above the stop with the thesis intact and a macro tailwind finally materializing.