AI Faith Shake Drags Down Global Stock Market, Nvidia Pre-Earnings Wall Street Institutions Debate Future Trends.

In recent times, concerns about the sustainability of AI trading and high valuations have led to a subdued performance of global stock markets, including the US stock market. Currently, global investors are closely watching for the upcoming earnings report of NVIDIA Corporation (NVDA.US). Some analysts believe that NVIDIA Corporation's earnings report will be a very important moment for the market. Market strategist Ryan Grabinski stated that the earnings results of NVIDIA Corporation are likely to have a chain reaction on the US and international markets. Despite the recent tempering of overall expectations for AI in the past few weeks, this earnings report may possibly shift sentiment back towards optimism. Based on the latest statements from top executives, there is a clear divergence in Wall Street's outlook for the future direction of the market. President of Goldman Sachs Group, Inc., John Waldron, stated at an economic forum on Wednesday that the market is prepared for potential further declines, but the extent of further declines will be moderate. He said, "In my view, the market may experience further corrections. I believe that there is a technical bias towards needing more protective measures, and there is more downside potential." Data shows that the S&P 500 index has dropped more than 3% so far this month, possibly marking the worst monthly performance since March. At the same time, market volatility has sharply increased. The sell-off of tech stocks reflects investors' debates on AI trading - whether the massive investments by large tech companies in AI infrastructure can generate enough revenue or profit. However, Waldron believes that the current market correction is healthy. He stated, "The current market is experiencing a correction, which I think is healthy. The market has accumulated significant gains so far this year." "The market places high importance on the development dynamics in the AI sector. Can companies achieve the expected capital investment returns? Is this already priced in by the market? These are major points of debate." He also emphasized that the latest earnings report to be released by NVIDIA Corporation on Wednesday "will be a very important moment for the market", and investors will be closely watching it. When asked about credit market risks, Waldron specifically pointed out the subprime loan market. He said, "I do believe that the weakest link in the economy is the low-end consumer group, and the size of loans to the subprime sector is quite substantial." He also stated that underwriting standards have started to loosen, but this does not mean that a credit crisis will erupt, "If the economy remains stable, the credit market will operate smoothly." Chief Executive Officer of Apollo Global Management Inc. (APO.US), Marc Rowan, also holds an optimistic view and downplays the concerns sparked by JPMorgan Chase CEO Jamie Dimon's remarks about a "roach" in the credit market. He said, "I have not observed any systemic risks." He believes that the impacts of tariffs and high interest rates are permeating the economy, but credit indicators are "improving, not deteriorating." Meanwhile, former Chief Executive Officer of Barclays PLC Sponsored ADR and current head of Atlas Merchant investment firm, Bob Diamond, who also attended the same forum, stated that the recent global market turbulence is more akin to a "healthy correction." Diamond said, "We are seeing risk assets being repriced. In my view, this is a healthy correction, not a signal of a bear market." Diamond said, "I believe it is appropriate to consider the impact of AI from the perspective of the next two, three, five years. This (AI) will be a true positive force in suppressing inflation and is crucial for enhancing global economic productivity. Some people are confused about valuations at the moment." He also pointed out that fiscal expenditure leading to an accumulation of sovereign debt is like a dark cloud hovering over the market. However, founder and CEO of Algebris Investments, Davide Serra, issued a more pessimistic warning at the forum. He suggested that investors reduce their exposure to top global tech companies, as "we are likely to face significant adjustments." Serra's pessimistic outlook is based on doubts about the income prospects of the AI revolution. He believes that given the global public debt levels and the extent to which tax revenues need to increase, it is "impossible" to achieve sufficient income to justify the AI revolution by 2030. The seasoned fund manager also pointed out that the US's share in the global market is approaching mathematical limits, "historically, no more than one-third of the economy has ever accounted for 70% of global valuations, so we are hitting the peak." Regarding the US dollar, Chief Executive Officer of Singapore government investment company Lim Chow Kiat and President and CEO of Franklin Templeton, Jenny Johnson, both stated that the questioning of the US dollar's status as the dominant global financial currency is overblown. Johnson said, "I believe that the dominance of the US dollar is unquestionable - the question is how much it will be weakened." CEO of Singapore state-owned investment company Temasek, Dilhan Pillay, revealed to attendees that the weakness of the US dollar has forced the company to hedge against depreciation risks. He said, "As everyone has started hedging, the cost of hedging has now gone up."