Next week's five major market highlights

Investing.com - As investors return to work this week, the future direction of President Trump’s tariff policies may become their primary focus. After the Supreme Court rejected his emergency tariffs, Trump moved to implement comprehensive tariffs, leaving the fate of his aggressive trade agenda—let alone multiple international agreements—uncertain. All eyes will also be on the performance of AI darling Nvidia and other tech sector companies, as well as key negotiations between the U.S. and Iran.

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1. Trump’s 15% Global Tariffs

In response to the Supreme Court’s ruling, Trump announced the implementation of a temporary 15% global tariff under the 1974 Trade Act, making tariffs once again a dominant market topic.

Initially, the White House stated that tariffs would be set at 10% starting Tuesday, but Trump later raised this figure over the weekend.

Importantly, Congress can extend the so-called Section 122 tariffs after they expire, and the constitutional trade powers granted to Congress are the core legal basis the Supreme Court used to overturn Trump’s emergency tariffs.

However, as analysts at ING pointed out, Trump could also do this. In theory, the president can let the additional tariffs expire, declare a new emergency, and restart the 150-day period, effectively creating a “de facto permanent tariff tool,” they said.

2. U.S. Customs and Border Protection to Cease Imposing Emergency Tariffs

Meanwhile, U.S. Customs and Border Protection announced that it will stop collecting the tariffs overturned by the Supreme Court at 12:01 a.m. Eastern Time on Tuesday (05:01 GMT)—but did not explain why tariffs are still being collected at entry points days after the ruling, nor whether importers will be eligible for refunds.

However, in a message to shippers, Customs and Border Protection stated that the cessation of collection does not apply to any other tariffs set by Trump, such as those imposed under national security and unfair trade practices laws.

Outside the U.S., major trading partners are trying to understand what the Supreme Court’s ruling means for recent trade agreements reached with the Trump administration.

The European Commission, the EU’s executive body and chief negotiator for the 27 member states, has called for the U.S. to provide “full clarity” on how tariffs will change post-ruling. Elsewhere, China—after a year of intense trade disputes with the U.S.—said it is conducting a “comprehensive assessment” of the Supreme Court’s decision and urged the U.S. to abandon “unilateral tariff measures” against its trading partners.

3. Nvidia Earnings in Focus

Nvidia has now become the focal point, with analyst expectations for its earnings serving as a global AI trading barometer and a marker for the direction of worldwide stock markets closely tied to this emerging technology.

The report is scheduled for release after the close on Wednesday Eastern Time, at a time when the so-called “Big Seven” tech stocks in the U.S. have largely stagnated this year. Since OpenAI launched ChatGPT in 2022, sparking a surge of enthusiasm around AI and a massive increase in infrastructure spending to support cutting-edge models, these stocks have soared.

Many of these companies are seen as major beneficiaries of the AI rise, and their stock surges have largely driven broader stock market gains in recent years.

However, this narrative has been challenged in recent weeks. Software stocks and many others have been impacted by concerns over disruptive new AI models, and investors are increasingly questioning when the huge AI investments will translate into substantial profits.

Laurence Booth, head of global markets at CMC Markets, said: “This week could be the most important week of the U.S. earnings season[…] Not only will Nvidia investors be nervous ahead of the company’s results; given the importance of AI trading, the entire global stock market could be on edge.”

4. Dell to Release Earnings

Also on this week’s earnings schedule, Dell will report its latest quarterly results after the market closes on Thursday.

AI-driven surges in data center spending have boosted demand for the company’s servers, prompting Dell to raise its annual revenue and profit forecasts in November. Dell has reached agreements with the U.S. Department of Energy and counts CoreWeave and Elon Musk’s xAI among its clients.

Despite this, Dell’s servers typically feature Nvidia’s high-end chips, but the company has been dealing with rising costs related to server manufacturing. The rapid build-out of AI infrastructure has driven up memory chip prices, increasing expenses.

Meanwhile, Dell faces increasingly fierce competition from peers like Supermicro.

5. U.S.-Iran Negotiations

At the same time, for Iran, this will be a “key week,” as Trump’s deadline means a decision will soon be made on whether to launch strikes against the country around March 1, according to analysts at Vital Knowledge.

Oman’s foreign minister said that on Thursday, Washington and Tehran will hold their third round of nuclear talks in Geneva.

The increased U.S. military presence in the Middle East highlights concerns over renewed violence in the region. Trump has called for Iran to quickly reach an agreement on its nuclear program, warning that “very bad things will happen” if it does not.

Iran is an important producer within OPEC, holding the world’s largest proven crude oil reserves. Oil prices fell on Monday.

This article was translated with the assistance of artificial intelligence. For more information, see our Terms of Use.