2 big AI narratives wrestle with each other: What to watch this week

Key Points:

• Market volatility remains high with investors cautious amid recent sell-offs, Big Tech earnings, and rising bond yields, while Goldman Sachs' panic gauge suggests potential for further rebounds.
• Key upcoming earnings to watch include CoreWeave, Nebius Group, and Cerebras Systems, which are impacted by the post-election data center slowdown, alongside a focus on their debt markets and business outlooks.
• The market is grappling with two competing AI narratives: the chip and AI infrastructure trade versus companies providing AI services, with Big Tech firms like Google, Microsoft, and Amazon showing resilience despite broader sell-offs.
• Economic focus centers on inflation data following a strong jobs report, with the Fed's rate hikes potentially reaching 6.75% to curb inflation; multiple Fed officials are scheduled to speak this week, offering guidance on monetary policy.
• A full economic and earnings calendar this week includes key inflation reports, jobless claims, and earnings from major companies such as Cisco, Applied Materials, Honda, and Mitsubishi UFJ Financial Group.