Charles-Henry Monchau

Chief Investment Officer

Chart #1 — 

Another strong quarter for Nvidia

 

Nvidia’s surprisingly robust first-quarter performance and its outlook for the second quarter are likely to provide reassurance to investors. However, the financial results were affected by a sudden and stricter export ban to China, which was implemented without a transition period. This led to an estimated $2.5 billion loss in Q1 sales, a $4.5 billion charge related to inventory, and a reduction of around $8 billion in projected Q2 sales.

However, excluding China, Q1 sales would have beaten consensus by 7–8%, and Q2 sales guidance would have been ~15% ahead, reflecting booming global demand.

Drivers include surging AI chatbot usage, accelerating enterprise AI adoption, and the recent rollback of non-China export restrictions. Nvidia's management indicated that China may no longer be a viable market, with Q2 guidance reflecting no anticipated AI chip sales to the country—making any future sales there a potential upside surprise. Although a large impairment charge impacted reported Q1 gross margin and earnings per share, the company's core profitability is strengthening as Blackwell chip production scales up. Overall, Nvidia is benefitting from even stronger demand momentum, with many prior investor concerns around the sustainability of demand now dissipated. Following its strong results, the stock rose and now trades at 28 times forward earnings (based on FactSet consensus), a compelling valuation considering Nvidia’s growth trajectory, market dominance, substantial cash reserves ($54 billion), and free cash flow now comparable to Apple’s—all supported by a consistent history of outperforming expectations.

Source: Quartr

 


Chart #2 — 

Mag 7 stocks account for more than half of S&P 500 gains since April bottom

Among all 503 stocks in the S&P 500, the “Magnificent 7” alone have contributed nearly 55% of the total market capitalisation gains since 7 April.

Source: Bloomberg, Tavi Costa


Chart #3 — 

Japanese insurers unrealised losses have been HUGE

 

In the first quarter, Japan’s largest insurers recorded unprecedented paper losses of ¥8.5 trillion ($60 billion) on their domestic bond portfolios. Nippon Life alone, the country’s biggest insurer and the sixth largest globally, posted a loss of ¥3.6 trillion ($25 billion).

Source: Bloomberg


Chart #4 — 

Microsoft borrowing cost is now almost equivalent than US Treasuries

The yield spread on Microsoft’s 30-year bond over equivalent US Treasuries has narrowed to just 20 basis points—an all-time low.

This suggests that investors view Microsoft’s credit risk as nearly equivalent to that of the US government, the world’s largest economy.

Source: Global Markets Investors


Chart #5 — 

Bitcoin ETFs pull in $9 billion

In the past five weeks, US Bitcoin ETFs have seen over $9 billion in inflows, with BlackRock’s iShares Bitcoin Trust ETF (IBIT) leading the surge. In contrast, gold-backed ETFs experienced outflows of more than $2.8 billion during the same timeframe, according to Bloomberg News data.

Source: Bloomberg News


Chart #6 —

China’s strategic shift: gold up, treasuries down

Over the past five years, their holdings of US Treasuries have dropped sharply, from approximately $1.1 trillion to around $760 billion, while their gold reserves have risen significantly, climbing from about 1,850 tons to over 2,200 tons.

 

Source: Bloomberg, Andrew Wells


Chart #7 — 

US dominance on the global stock market

This is what American exceptionalism looks like: the US is home to 1,873 companies valued at over a billion dollars. Japan ranks a distant second with 404, followed by India with 348.

Source: Visual Capitalist


Disclaimer

This marketing document has been issued by Bank Syz Ltd. It is not intended for distribution to, publication, provision or use by individuals or legal entities that are citizens of or reside in a state, country or jurisdiction in which applicable laws and regulations prohibit its distribution, publication, provision or use. It is not directed to any person or entity to whom it would be illegal to send such marketing material. This document is intended for informational purposes only and should not be construed as an offer, solicitation or recommendation for the subscription, purchase, sale or safekeeping of any security or financial instrument or for the engagement in any other transaction, as the provision of any investment advice or service, or as a contractual document. Nothing in this document constitutes an investment, legal, tax or accounting advice or a representation that any investment or strategy is suitable or appropriate for an investor's particular and individual circumstances, nor does it constitute a personalized investment advice for any investor. This document reflects the information, opinions and comments of Bank Syz Ltd. as of the date of its publication, which are subject to change without notice. The opinions and comments of the authors in this document reflect their current views and may not coincide with those of other Syz Group entities or third parties, which may have reached different conclusions. The market valuations, terms and calculations contained herein are estimates only. The information provided comes from sources deemed reliable, but Bank Syz Ltd. does not guarantee its completeness, accuracy, reliability and actuality. Past performance gives no indication of nor guarantees current or future results. Bank Syz Ltd. accepts no liability for any loss arising from the use of this document.

Read More

Straight from the Desk

Syz the moment

Live feeds, charts, breaking stories, all day long.

Thinking out loud

Sign up for our weekly email highlighting the most popular posts.

Follow us

Thinking out loud

Investing with intelligence

Our latest research, commentary and market outlooks