Can U.S. stocks break out this week? The storm of GEO Group Inc rises again, keep a close eye on U.S. bonds and NVIDIA Corporation (NVDA.US) earnings report.

After the US-China summit, the situation of GEO Group Inc returned to the spotlight, the US bond yields rose, and inflation remained high, among other factors, causing market sentiment to turn cautious, resulting in a drop in US stocks across the board last Friday. Looking at the market data, the S&P 500 index fell by 1.2% last Friday, with a slight increase of only 0.1% for the whole week; the tech-heavy Nasdaq index fell by 1.5% last Friday, with a slight decline of 0.1% for the whole week; the Dow Jones Industrial Average fell by 1.1% last Friday, with a cumulative decline of 0.2% for the whole week. It is worth noting that last week, the 10-year US bond yield broke through the 4.5% level, putting pressure on risk assets, and this indicator will continue to be closely watched by the market this week. In addition, the quarterly earnings report of NVIDIA Corporation (NVDA.US) to be released this week will not only affect its own stock price but also directly impact the AI field and the overall trend of the tech stocks. Key economic events this week After several weeks of intense earnings reports and economic data releases, the market pace has slowed down this week, ushering in a brief rest period. The biggest focus of the market this week will be the quarterly earnings report of NVIDIA Corporation to be announced post-market on Wednesday. This chip giant's market value surpassed $5.7 trillion last week, solidifying its position as the world's most valuable company. Comments regarding its cooperation with China during the earnings call will be the market's focus. Other earnings reports worth noting include: retail giants Target Corporation (TGT.US) on Wednesday and Walmart Inc. (WMT.US) on Thursday will both disclose their performance; on Monday, budget airline Ryanair (RYAAY.US) will release its earnings report, and on Friday, top US government defense contractor Booz Allen Hamilton Consulting Company (BAH.US) will also report its results. Furthermore, the Michigan University report on market sentiment and inflation expectations will be released on Friday, becoming the highlight of this week's economic calendar. Investors will also receive data on the service sector economy from the New York Fed on Monday and the Kansas City Fed on Friday. This week's "wild card": NVIDIA Corporation to release Q1 earnings report post-market on Wednesday The most anticipated event this week is undoubtedly the quarterly earnings report of NVIDIA Corporation to be announced on Wednesday. The performance of NVIDIA Corporation has always been a benchmark not only for the semiconductor industry but also an important indicator for the AI field and the large tech stock market. Despite NVIDIA Corporation's market value surpassing $5.7 trillion, UBS Group AG analyst Tim Arcuri pointed out that investors have been cautious for the past few months, and only an outstanding earnings report can completely boost market confidence. Arcuri said, "NVIDIA Corporation has always attracted a lot of attention from investors, but even institutional investors who have long held the stock have shown reduced enthusiasm. In this context, if the company delivers impressive results and releases positive news about capital return, the stock price is expected to rise." The market will also closely monitor the cooperation outcomes achieved by Huang Renxun during his recent visit to China. Earlier reports indicated that the US has approved industry giants such as Alibaba Group Holding Limited Sponsored ADR, Tencent, ByteDance, etc., to purchase NVIDIA Corporation's H200 series chips, which also briefly pushed NVIDIA Corporation stock to a record high. In addition, Bank of America Corp analyst Vivek Arya stated that investors will closely watch NVIDIA Corporation's statements regarding its competitors in the chip design field, including industry veterans like AMD (AMD.US), Broadcom Inc. (AVGO.US), as well as the newcomer Cerebras Systems (CBRS.US) that went public last Thursday. Data compiled by Capital IQ shows that analysts expect NVIDIA Corporation's adjusted earnings per share for the first quarter to be $1.78, with revenue of $79.2 billion. Continued emphasis on the "K-shaped economy" The long-debated "K-shaped economy" trend continues. This term refers to the phenomenon where different parts of a group are moving in opposite directions. This differentiation is now particularly evident in energy consumption and travel consumption. Analysts at Bank of America pointed out that the rise in energy prices is more significant for low-income households, as essential energy expenses such as electricity and gasoline account for a higher proportion of their total income. As a result, low-income groups have significantly reduced energy consumption, with gasoline expenditure growth at a low level; in contrast, high-income individuals have almost not reduced their daily energy usage. Bank of America economists also noted that due to the turmoil in the Middle East, gasoline and aviation fuel prices have risen significantly, leading to a distinct division in American travel consumption. Although the Iran war only resulted in about 10% of Americans completely canceling their travel plans, the high-income Americans have seen a faster growth rate in travel expenditures compared to the middle and low-income groups. While most Americans have not canceled their travel plans due to the price hike caused by the war, many have opted to reduce the frequency of travel or cut expenses on accommodations, even though overall spending remains relatively stable. Investors will continue to pay attention to retail giants like Walmart Inc. and airlines' earnings reports to assess the condition of American consumers. A new supercycle of commodities may be starting Jeff Currie, the energy strategist at Carlyle Group Inc., predicts that the market may be at the beginning of a new commodity supercycle. In an article published last Friday, Currie argued from various perspectives that the market is at the starting point of a new long-term bull market in commodities, which he called the "most asymmetric investment opportunity in modern financial history." Firstly, Currie stated that the artificial intelligence industry is facing severe resource constraints in energy, metals, and computing power. At the same time, the "Seven Giants" are expected to spend over $700 billion on capital expenditure by 2026, further exacerbating the resource gap. Secondly, the conflicts in the Middle East have triggered a major energy supply crisis, with global daily oil supply dropping by over 13.7 million barrels, according to Goldman Sachs Group, Inc. Industry insiders believe that even if the situation eases in the future, the market dynamics in the Gulf region, which is a core supplier of global energy, industrial metals, and fertilizers, have been fundamentally reshaped. Currie commented, "Funds are flooding into the AI field but overlooking the physical assets that support the operation of the AI industry - and these assets have quietly become the best-performing asset class in the past decade." Currie also pointed out that the global trade landscape is gradually moving towards deglobalization, and investment logic is also changing: transitioning from the "HAGO" model, characterized by "hard assets, global operations," to a new "HALO" model. Currie redefined "HALO" as "hard assets, local operations," rather than the traditional understanding of "heavy assets, low churn rate." Currie concluded, "Traditional industries are experiencing a strong comeback. Buy low, hold steady positions, and wait for the market to take off."