Nvidia drops more than 5%, dragging down the Nasdaq; Cook teases! Apple will start releasing new products gradually beginning next Monday

U.S. stocks were mixed on Thursday, February 26, Eastern Time, marking the start of a new rotation market. Nvidia’s earnings report caused the stock to plunge over 5% again, dragging the Nasdaq down more than 1%. The Dow slightly rose, while small-cap stocks closed higher against the trend. Apple CEO Tim Cook confirmed that Apple will hold a new product launch event next Monday, and Google upgraded its popular image generation tool Nanobanana. The Iran-U.S. Geneva talks concluded with multiple parties stating “positive progress.”

【U.S. Stock Indices】

At the close, the S&P 500 fell 0.54% to 6,908.86; the Dow Jones rose 0.03% to 49,499.20; the Nasdaq dropped 1.18% to 22,878.38.

Yesterday after hours, Nvidia announced another strong and better-than-expected quarterly earnings report, but it still couldn’t escape the post-earnings plunge nightmare. According to Bespoke, this is the third consecutive time Nvidia has fallen after releasing an overall better-than-expected report. This pattern of falling after strong earnings can be traced back to summer 2024. Since August 2024, regardless of earnings quality, Nvidia’s stock has consistently opened lower the next day.

Some analysts pointed out that Nvidia rarely misses on earnings, but the current market environment clearly raises questions beyond just how many chips the company sells. Fundstrat’s chief strategist Hardika Singh said Nvidia almost never misses on revenue, net income, or guidance, but the issue is that Nvidia has failed to ease investor concerns about its shrinking moat and hasn’t clearly explained its strategic response amid ongoing shifts in computing power and AI revolution waves that could disrupt industries from cybersecurity to food delivery to banking.

Other analysts noted that “the market is currently fighting broad AI concerns. Investors are worried that since core customers—large cloud service providers—are draining most of their cash flow through AI-related capital expenditures, how Nvidia will sustain its incredible growth in the future.”

Additionally, “big short seller” Michael Burry pointed out that Nvidia’s latest 10-K mentions irrevocable purchase commitments totaling $95.2 billion, up from $16.1 billion a year earlier, due to TSMC requiring longer-term contracts and prepayments. If demand wavers, this ballooning figure could pose risks.

Despite each decline, retail investors remain highly enthusiastic about this AI leader. Vanda Research data shows that while institutions have been selling heavily, retail net buying of Nvidia hit a record high since 2012.

On the geopolitical front, the third round of Iran-U.S. negotiations concluded, with Iran’s Foreign Minister saying good progress was made, but U.S. media reported disappointment during the talks. The conflicting news caused significant intraday volatility in crude oil prices.

According to CCTV News, on February 26, Iran’s Foreign Minister Amir Abdollahian said after the third round of indirect talks, “This was the most serious and longest-lasting negotiation.” Good progress was made, and in some areas, both sides are close to reaching consensus. Technical negotiations will be held next Monday, March 2, in Vienna, Austria.

【U.S. Treasury Bonds】

U.S. Treasury yields declined, with the benchmark 10-year yield closing at 4.002%, and the 2-year yield sensitive to Fed policy at 3.475%.

【Popular U.S. Stocks】

Among popular stocks, Nvidia fell 5.46%, Apple declined 0.47%, Google A dropped 1.76%, Google C down 1.88%, Microsoft rose 0.28%, Amazon fell 1.29%, TSMC declined 2.80%, Meta increased 0.51%, Tesla fell 2.11%, Super Micro Semiconductor dropped 3.41%, Intel declined 3.03%.

In major news, Google announced the launch of its new image generation model Nano Banana 2 (Gemini 3.1 Flash image model).

Latest reports indicate that Meta abandoned its most advanced AI training chip last week due to design difficulties and shifted focus to a less complex version.

Apple CEO Tim Cook posted that next week will be lively, starting Monday night Beijing time. This signals an upcoming wave of new Apple products, with daily updates expected and new products announced every evening.

【Global Indices】

In Europe, the FTSE 100 rose slightly by 0.37% to 10,847; France’s CAC 40 increased 0.72% to 8,621; Germany’s DAX gained 0.45% to 25,289.

In Asia, the Hang Seng Index fell 1.44% to 26,381; the China Enterprises Index dropped 2.44% to 8,814; the Nikkei 225 rose 0.29% to 58,753.

【China Indices】

On February 26, overnight, Hang Seng Tech futures fell 2.86%, Nasdaq China Golden Dragon Index declined 1.78%, and FTSE China A50 Index dropped 0.89%.

【Chinese Concept Stocks】

Popular Chinese stocks: Tencent Holdings (HK) down 2.01%, Alibaba down 2.78%, Pinduoduo down 1.41%, NetEase down 0.16%, Baidu down 5.65%, Ctrip down 2.59%, Li Auto down 2.98%, Xpeng Motors down 2.26%, NIO down 1.73%.

【Forex and Commodities】

Amid tariff chaos and Iran-U.S. negotiations, the dollar remains strong. On Thursday, the dollar index softened during Asia-Pacific hours, then rose in U.S. trading near 98 before facing resistance and retreating, ending up 0.09% at 97.791.

Traders closely monitor Iran-U.S. talks and tariff policy uncertainties for the next major move in international spot gold, which edged higher. Spot gold briefly broke above $5,200 but failed to hold, closing up 0.46% at $5,185.52 per ounce; spot silver broke above $90 during the session, then retreated and rose again, ending up 0.84% at $88 per ounce.

Crude oil prices rose about 2 intraday, but after reports of positive progress in Iran-U.S. talks, prices turned lower. WTI crude rose slightly by 0.05% to $65.45 per barrel; Brent crude gained 0.14% to $70.79 per barrel.

【Key Highlights】

Federal Reserve Governor Milan: Reiterates Need for 100 Basis Point Rate Cut by 2026, Warns Overregulation Distorting Credit Structure

Federal Reserve Governor Milan reiterated Thursday that despite labor market improvements, a 100 basis point rate cut is still expected by 2026, and favors early action. He noted that excessive regulation has increased bank lending costs, leading to a surge in private credit, but currently does not pose systemic risks. Milan remains cautious about employment prospects, citing weak inflation pressures to support rate cuts. He has repeatedly opposed holding rates steady and advocates for larger cuts.

Why Is Nvidia’s “Spectacular” Earnings Report Met with a “Cold Shoulder”?

Nvidia has exceeded expectations for 14 consecutive quarters. When beating expectations becomes routine, strong earnings alone are no longer enough. Market focus has shifted to concerns over the sustainability of AI demand and Nvidia’s supply constraints, with large long positions criticized for cross-shareholdings with clients. Despite strong growth in data center business, other segments underperform.

Google Upgrades Its Popular Image Tool Nano Banana Pro with Enhanced Capabilities and Flash Speed, Launches Gemini and Search on Thursday

Nano Banana Pro remains available for high-fidelity tasks requiring maximum factual accuracy; Nano Banana 2 focuses on “fast generation, precise instruction following, and image search integration,” supporting text-to-image, data visualization, in-image text translation, with up to 14 object detail restoration, resolution from 512 pixels to 4K. Since its launch in Gemini App last November, Google reports over 20 million uses of SynthID verification.

Meta’s Self-Developed Chips Reportedly Encounter Obstacles

Latest reports indicate Meta abandoned its most advanced AI training chip last week due to design difficulties, shifting focus to a less complex version. The company informed its AI infrastructure team of the updated plan last week. This follows recent large-scale chip contracts with Nvidia and AMD. A Meta spokesperson said, “We remain committed to investing in a diversified chip portfolio to meet our needs, including advancing our MTIA line; more updates will be disclosed later this year.”

Tesla’s California Autonomous Driving “Pie in the Sky”? Regulatory Records Show Six Years of Zero Road Testing Miles

Tesla has made no substantial progress on its California Robotaxi project: six consecutive years with zero road testing miles (only 562 miles), far below the 50,000 miles required for operational approval. Musk blames regulatory approval delays, but experts argue the opposite: the company has not even met basic testing requirements, and the so-called “Robotaxi” in the Bay Area is actually a human-assisted driving service.

Netflix Withdraws from Warner Bros. Acquisition Deal

Warner Bros. Discovery announced after hours Thursday that its board considers Paramount’s latest bid superior to Netflix’s. Netflix has four business days to revise its offer or walk away with a $2.8 billion breakup fee funded by Paramount. Netflix quickly stated that, given the need to match Paramount’s latest bid, the deal is no longer financially attractive, and decided not to match. Following this news, Netflix’s stock rose nearly 10% after hours.

Dell’s Earnings and Guidance Surpass Expectations; AI Server Revenue Expected to Double This Year; Shares Jump Over 12% Post-Market

Dell reported record revenue, profit, and cash flow for Q4 and the full year, with AI-optimized server business as a key growth driver. The company projects FY2027 revenue up to $142 billion, with AI server revenue doubling to about $50 billion year-over-year, significantly exceeding market expectations, boosting the stock by over 12% after hours.

Third Round of Iran-U.S. Talks Conclude, Iran’s Foreign Minister Says Good Progress; U.S. Media Report Disappointment

U.S. media report that the U.S. has made tough demands, with clear disagreements with the military. Iran’s Foreign Minister said the two sides are close to consensus in some areas, with technical talks scheduled next Monday in Vienna. Oman’s foreign minister called the negotiations “a major breakthrough.” Media suggest significant differences remain: the U.S. insists Iran must dismantle nuclear facilities and transfer all enriched uranium abroad; Iran proposes a temporary halt to nuclear activities with future resumption under regulatory oversight. Iran’s spokesperson said, “We will continue uranium enrichment as needed.”