Nasdaq Futures Buoyed by Nvidia Earnings, Software as Oil Falls

 

Nasdaq Futures Buoyed by Nvidia Earnings, Software as Oil Falls

## The AI Trade Is Back

Just when the whispers of an AI bubble were getting loud enough to make investors nervous, Nvidia did what it does best: it put the doubters to bed with a blockbuster quarter that didn't just beat expectations—it obliterated them.

On Wednesday evening, the world's most valuable chipmaker reported second-quarter revenue of **$96.22 billion**, crushing the $92.2 billion Wall Street had penciled in. Adjusted earnings per share of **$2.22** sailed past the $2.10 consensus. Revenue surged **106%** year-over-year. And perhaps most importantly, the company guided third-quarter revenue to **$108 billion**—well above analyst expectations.

The reaction was immediate and unmistakable. Nvidia shares jumped **7% in premarket trading** on Thursday, lifting Nasdaq 100 futures **1.12%**. S&P 500 futures rose 0.49%, while Dow futures barely budged. The AI trade—which had been showing signs of fatigue—was suddenly roaring back to life.

But Nvidia wasn't the only star of the show. A sweep of bullish earnings from the software sector added fuel to the fire, with Salesforce leading the charge with an **11% premarket gain**. CrowdStrike and Okta also surged after reporting better-than-expected results. Investors who had been fretting about AI eating into software margins got a reprieve. The message was clear: the software sector isn't just surviving the AI revolution—it's thriving alongside it.

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## Nvidia's Earnings: A Masterclass in Execution

### The Numbers That Matter

Let's put Nvidia's quarter in perspective. The company didn't just beat the Street—it cleared the bar by roughly **$4 billion**. Revenue of $96.22 billion represents a **106% increase from $46.7 billion a year earlier**. Adjusted operating income for the quarter totaled **$64 billion**.

The data center business—the engine of Nvidia's AI dominance—continued its relentless march, with revenue surging **117% year-over-year** to $890 billion. Gross margins held steady at **75%**. And the company's $108 billion third-quarter guidance sent a powerful signal: demand for AI infrastructure isn't slowing down.

**"The AI infrastructure buildout is at full steam,"** CEO Jensen Huang said in prepared comments. CFO Colette Kress added that Nvidia sees revenue growing approximately **70% in the next fiscal year**, though supply bottlenecks remain a constraint.

### The Vera Rubin Catalyst

Perhaps the most significant revelation from the earnings call was the strength of **Vera Rubin**, Nvidia's next-generation computing platform that succeeded Blackwell. Kress said the company has received orders from **"every major hyperscaler, AI cloud, and system OEM"**. Production shipments kicked off earlier this month.

**"We expect Vera Rubin to mark the fastest product ramp in Nvidia's history,"** Kress said, projecting it would account for about **20% of Nvidia's data center revenue in the current quarter**.

In other words, the AI buildout isn't just continuing—it's accelerating.

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## The Software Surge: Salesforce and the Sector's Rebound

If Nvidia's earnings were the main event, the software sector's performance was the compelling undercard. For months, investors had worried that the rise of AI would cannibalize traditional software margins. Thursday's earnings presentations suggested those fears may be overblown.

Salesforce led the charge with an **11% premarket surge**. CrowdStrike and Okta also posted strong gains after their own bullish reports. The sector-wide rally quieted investor pessimism and signaled that software companies are finding ways to benefit from—rather than be disrupted by—the AI wave.

The message from the software sector was consistent with Nvidia's: the AI revolution is creating winners across the technology landscape, not just in the semiconductor space.

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## Oil Falls: A Fourth Day of Declines

### The Hormuz Factor

While technology stocks soared, oil prices continued their slide. Brent crude fell **0.7% to $87.24 a barrel**, extending its losing streak to a fourth straight session. West Texas Intermediate dropped **0.7% to $81.67**, marking a fifth consecutive decline.

The catalyst? Growing hopes for a reopening of the **Strait of Hormuz**. Iran and Oman have been working to finalize an agreement governing the strategic waterway, which carries about **one-fifth of global oil and LNG supply**. Before the war, roughly 130 vessels crossed the strait daily; that number has since fallen to about a quarter of pre-war levels.

Iran's Revolutionary Guards said the two countries had reached an understanding on how to share control of the strait and its revenues. Qatar's prime minister was due to travel to Iran on Thursday to restart diplomatic discussions aimed at ending the conflict.

### The Supply Question

Despite the diplomatic progress, analysts caution that the supply picture remains uncertain. The U.S. has stopped its attacks on Iran for about a month and is seeking to increase economic pressure on the country. But Iran and other countries remain far apart on the conditions for ending the fighting. Iranian officials have said the strait would remain closed unless the U.S. agrees to meet under the June ceasefire deal that subsequently fell apart.

JPMorgan estimates that **every additional month of disruption could add around $7–$8 a barrel to Brent prices**. For now, the market is pricing in hope—but the risks remain tilted to the upside.

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## The Bond Market: Waiting for Warsh

### Yields Rise Ahead of Jackson Hole

While tech stocks rallied and oil fell, bond investors were focused on a different event: Federal Reserve Chair Kevin Warsh's highly anticipated appearance at the **Jackson Hole symposium** on Friday.

Yields on 10-year Treasurys traded up **0.6 basis points at 4.669%**, while 30-year yields rose 1 basis point to 5.183%. German Bund yields rose 0.7 basis points to 3.229% as higher natural gas prices drove inflation concerns.

The benchmark 10-year Treasury note was slightly lower at **4.645%** early Thursday, while the 30-year yield dipped to 5.161%. One basis point equals 0.01%. The moves were modest, reflecting the market's cautious posture ahead of Warsh's speech.

### What Investors Want From Warsh

Wednesday's PCE data showed inflation stubbornly above the Fed's 2% target, adding to pressure on Warsh to signal openness to raising rates. Markets are currently pricing in about a **36% chance** of a Fed rate hike in September.

Investors are hungry for more information regarding Warsh's views on the economy, inflation pressures, and the role of monetary policymaking. His last major public outing did little to calm markets, with remarks seen as vague while higher Treasury yields have already tightened financial conditions.

The central bank's communication has become harder amid a mix of sticky inflation and slow growth. Investors want Warsh to explain how he plans to bring inflation back to target without making the bond market more unstable.

### The Debasement Risk

There's a wild card in the mix. If Warsh repeats the tone of his last Fed press conference, it could revive fears around **dollar debasement** and support gold prices. Gold has already been drawing support from those concerns, edging higher as markets waited for Warsh's policy signals.

The dollar, meanwhile, has found support from rate expectations, though its gains could be capped if the Fed avoids further hikes this year.

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## The Broader Market: Mixed but Optimistic

### Global Tech Rallies

The Nvidia effect wasn't confined to U.S. markets. In Asia, South Korea's Kospi rose **1.5%** on gains for memory chip makers. Samsung Electronics rose 1.7%, while SK Hynix added 2.5%. European AI-related stocks also jumped, with ASML gaining 1.2%.

The broader European market slipped, however, as weakness in oil majors and luxury stocks dragged. U.S. futures painted a picture of a gap-up open, with Nasdaq futures leading the way.

### The Currency Picture

In currency markets, the U.S. dollar was steady. The Japanese yen was little moved after the Bank of Japan's deputy governor vowed to remain alert to inflation risks. Markets are increasingly confident the BOJ will hike rates in September.

Gold remained elevated at **$4,647.60 a troy ounce**, reflecting ongoing safe-haven demand amid geopolitical uncertainty.

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## What This Means for Investors

### The AI Trade Is Alive

Nvidia's earnings put to rest—at least for now—concerns that the AI buildout is slowing. The company's $108 billion guidance and the strong reception to Vera Rubin suggest that demand for AI infrastructure remains robust. For investors who have been waiting for a pullback to buy, the window may be closing.

### Software Is a Partner, Not a Victim

The software sector's strong earnings suggest that AI isn't displacing traditional software companies—it's creating new opportunities for them. Salesforce, CrowdStrike, and Okta all demonstrated that they can grow alongside the AI revolution, not in spite of it.

### Oil Remains a Wild Card

The diplomatic progress around the Strait of Hormuz is encouraging, but the supply picture remains uncertain. Any setback in negotiations could send oil prices sharply higher, reigniting inflation fears and complicating the Fed's path.

### Jackson Hole Is the Key Event

Friday's speech by Fed Chair Kevin Warsh is the most consequential event of the week. Investors are looking for clarity on the Fed's policy path. If Warsh signals openness to further rate hikes, bond yields could rise further, putting pressure on stocks. If he strikes a more dovish tone, the AI rally could accelerate.

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## Frequently Asked Questions

### 1. How did Nvidia perform in Q2 2026?

Nvidia reported record second-quarter revenue of **$96.22 billion**, up 106% year-over-year, and adjusted earnings of **$2.22 per share**. Both figures beat Wall Street estimates. The company also guided third-quarter revenue to **$108 billion**.

### 2. Why did Nasdaq futures rise on August 27?

Nasdaq 100 futures rose **1.12%** after Nvidia's strong earnings and upbeat guidance renewed investor confidence in the AI trade. Software stocks like Salesforce, CrowdStrike, and Okta also surged after reporting better-than-expected results.

### 3. What happened to oil prices?

Oil prices fell for a fourth consecutive session, with Brent crude dropping **0.7% to $87.24** and WTI falling **0.7% to $81.67**. The declines came amid hopes for a reopening of the Strait of Hormuz following diplomatic efforts involving Iran and Oman.

### 4. What is the significance of the Jackson Hole symposium?

Jackson Hole is the Federal Reserve's annual economic policy symposium. This year marks **Kevin Warsh's first appearance as Fed chair**. Investors are looking for clarity on how he plans to bring inflation back to target without destabilizing the bond market.

### 5. What are the odds of a September rate hike?

Markets are currently pricing in about a **36% chance** of a Fed rate hike in September. Traders see about a **70% chance** of at least a 25-basis-point rate increase by December.

### 6. How did software stocks perform?

Software stocks surged premarket, led by an **11% gain for Salesforce**. CrowdStrike and Okta also posted strong gains after their own bullish earnings reports. The sector-wide rally quieted investor pessimism about AI competition.

### 7. What is Vera Rubin?

Vera Rubin is Nvidia's next-generation computing platform, the successor to Blackwell. Production shipments began this month, and the company has received orders from "every major hyperscaler, AI cloud, and system OEM". CFO Colette Kress expects it to mark the fastest product ramp in Nvidia's history.

### 8. What should investors watch for in Warsh's speech?

Investors are looking for clarity on the Fed's policy path, particularly whether Warsh is open to further rate hikes. A hawkish tone could push yields higher and pressure stocks, while a dovish tone could fuel the AI rally.

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## The Bottom Line

Thursday, August 27, 2026, is shaping up to be a day of contrasts. Technology stocks are soaring on the back of Nvidia's blockbuster earnings and a software-sector rally. Oil is falling for a fourth straight day as hopes rise for a diplomatic breakthrough in the Middle East. And bond investors are holding their breath, waiting for Fed Chair Kevin Warsh to provide clarity on the path forward.

The AI trade is alive and well. Nvidia's $108 billion guidance and the strong reception to Vera Rubin suggest that the infrastructure buildout is far from over. The software sector is proving that it can thrive alongside the AI revolution, not in spite of it. And oil prices, for now, are providing relief.

But the bond market is the wild card. If Warsh signals openness to further rate hikes on Friday, yields could rise further, putting pressure on stocks. If he strikes a more dovish tone, the AI rally could accelerate. Either way, investors are in for a volatile end to the week.

The AI trade is back. The question is how long it will last.

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## Disclaimer

*This article is for informational and educational purposes only and does not constitute financial, investment, tax, or legal advice. All views expressed are based on publicly available information as of August 27, 2026. Market conditions, earnings reports, and Federal Reserve policy are subject to rapid change. The author does not endorse any specific investment strategies or products. Past performance is not indicative of future results. Before making any financial or investment decisions based on the content of this article, please consult with qualified professionals who can evaluate your specific situation.*