Nvidia Earnings and Fed Keynote Test AI Market Rally

Market volatility is centering on Nvidia Inc. and Federal Reserve Chair Kevin Warsh during the final week of August. Nvidia reports second-quarter earnings on Wednesday, serving as a critical benchmark for the artificial intelligence trade. This report arrives as investors rotate funds from AI-centric stocks into inflation-sensitive assets, making the results a proxy for the health of the broader AI ecosystem.

Simultaneously, Kevin Warsh is scheduled to deliver his first Jackson Hole keynote on Friday. While the official focus is on payments innovation, investors are monitoring his remarks for signals on inflation and bond market volatility. Since taking office in May 2026, Warsh has moved away from traditional forward guidance, leaving markets to price in a 35% chance of a September rate hike and a 66% chance by December.

These events coincide with a surge in global bond yields, with the 30-year Treasury yield hitting its highest level since 2007. To curb a selloff in long-term bonds and lower borrowing costs for AI investments, the United States Department of the Treasury doubled buybacks for long-dated debt, though yields rebounded shortly after. Tension remains high due to rising credit spreads for hyperscalers and high Brent crude oil prices, which threaten AI investment returns.