U.S. stocks rose on Tuesday amid speculation of possible interest rate cuts following President Trump’s attempt to fire Fed Governor Lisa Cook. Nvidia’s upcoming earnings report may impact the tech sector and overall market. European shares fell, China’s indices eased, and Wall Street edged higher. Dollar weakened, bond yields rose, and oil prices fell.

Trump’s attempt to fire Fed Governor Lisa Cook has escalated tensions with the central bank. Traders are betting on a rate cut next month, but doubts over Fed policy credibility are increasing. Long-term bond yields are rising globally, with Britain and Japan seeing significant increases. France’s minority government is facing challenges over budget cuts.

Nvidia’s quarterly results are highly anticipated as doubts about AI returns grow. The company is valued at $4.4 trillion and expected to report a 53% increase in revenue. Investors are questioning the ROI on AI investments, causing a shift from tech to small caps. Tech stocks have surged, but a correction may be looming.

Companies are investing billions in AI, raising concerns about ROI. Global spending on data centers is expected to reach trillions, with potential economic value creation of $920 billion per year. Long-term adoption of AI could significantly impact the market, but investors may grow impatient if returns fail to materialize. Tech shares have soared, but a pullback is possible.

Nvidia’s earnings release could influence market sentiment tomorrow, along with economic data from Australia and Germany. U.S. Treasury auctions and a speech from Richmond Fed President Thomas Barkin will also be watched closely. Sign up for the Trading Day newsletter for daily market insights. Opinions expressed are those of the author and not Reuters News.

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