NVIDIA Earnings Preview for Q3: Can It Save the Financial Markets?

Global markets are turning their attention to NVIDIA’s Q3 results for fiscal year 2026, as the company is the last among the “Magnificent 7” that have generally reported positive earnings.

Markets are also closely monitoring developments in US tariff, including updates on agreements with Switzerland and South Korea, as well as President Trump’s removal of some tariffs on goods not produced in the US, such as coffee.

Early this week, Japan may announce a massive stimulus package early this week to support and boost the economy under new Prime Minister Sanae Takaichi, while the UK prepares to release its consumer price index.

Key highlights:

• Markets focus on NVIDIA’s earnings.
• Major developments in US tariffs.
• Japan prepares one of its largest economic stimulus packages.

NVIDIA Earning Preview Q3: Impact on Global Financial markets

The US economy

Last week, the US economy experienced a highly volatile and closely watched period, particularly as the longest government shutdown in history, lasting over 43 days, came to an end. This followed President Donald Trump signing a new federal budget, which will reinstate furloughed employees and ensure they receive back pay.

However, despite ending the shutdown, economic uncertainty persisted, fueled in part by White House statements regarding possible delais in the release of economic data. This could complicate the Federal Reserve’s interest rate decisions at its next meeting on December 10.

Analysts note that ending the shutdown did not solve structural problems but merely postponed them. The new law authorized funding for food assistance programs, such as SNAP, until the end of January next year.

The bill does not extend health insurance support under the Affordable Care Act (ACA), a key demand of Democrats. Tax exemptions funding healthcare are expected to expire by year-end, potentially affecting 22 million low-income Americans. Instead, Democrats and Republicans agreed to hold another vote in December to decide on separate healthcare support.

Thus, the US economy remains dependent on two factors: bipartisan agreement to extend aid before year-end and the Trump administration’s ability to draft a compromise that satisfies all parties.

Developments in tariffs

The US-South Korea trade deal initially faced some confusion, but both sides announced on Friday details of a trade agreement, including South Korean investment of $150 billion in the US shipbuilding sector and $200 billion in other industrial sectors, in exchange for a US tariff reduction from 25% to 15%.

Similarly, Switzerland reached a trade agreement with the US, lowering tariffs on Swiss products from 39% to 15%, in return for Swiss companies investing around $200 billion in the US by the end of 2028.

President Trump also announced significant tariff reductions to address Americans’ concerns about rising costs of essential goods, including new trade deals with Argentina, Guatemala, El Salvador, and Ecuador.

The European Union stated that it would propose a plan to the US to implement the next phase of the trade agreement reached in July.

NVIDIA earnings for Q3: Can it rescue financial markets and AI technology stocks?

Global markets will focus on NVIDIA’s earnings and CEO Jensen Huang’s statements on Wednesday evening. Expectations suggest that the AI giant could achieve $54.62 billion in revenue for Q3 FY2026.

NVIDIA’s stock has experienced its sharpest weekly decline since April, falling more than 10% over the past two weeks. However, analysts believe NVIDIA can recover, supported by strong demand for its new “Blackwell” graphics hips used in global data centers.

On the other hand, NVIDIA faces risks from economic pressures, particularly those arising from tariffs despite the US-China truce in October, as well as uncertainty over future Federal Reserve interest rates.

In conclusion:

Investors will focus on key metrics when NVIDIA announces its earnings, especially its ability to surpass expectations. Meeting expectations alone is no longer impressive for a company that is at the forefront of the AI revolution.

The EU economy: US exports on the rise

According to Eurostat, the Eurozone economy continued modest growth in Q3, rising by 0.2%. However, countries representing 49% of the EU’s GDP showed no expansion, with Germany joining Italy in economic stagnation.

Data showed an increase in the trade surplus in September, thanks to rising exports to the US, reflecting unexpected resilience in the Eurozone amid trade conflicts and uncertainty throughout the year.

The Eurozone’s ability to withstand tariffs and maintain inflation near the 2% target will remain a key factor in the reluctance of policymakers to cut interest rates, keeping them at 2%, a neutral rate that neither restricts nor stimulates growth.

The Japanese economy: First stimulus package

Japan’s main opposition party, the Constitutional Democratic Party, proposed a $58 billion economic package, including cash assistance for households struggling with inflation. The party called for inclusion of this plan in a broader economic stimulus package, estimated at ¥17 trillion (≈$110 billion).

Two senior finance officials joined Japan’s top policy council, advocating bold spending to relieve household hardship and support growth, even as recession risks loom.

Q3 GDP readings may accelerate stimulus approval to rescue the Japanese economy, with forecasts predicting a 2.4% contraction year-over-year in the three months ending September. The contraction is attributed to weak exports from USs trade policies, a sharp decline in residential investment, and low consumer spending.

The Chinese economy

China’s factory output and retail sales grew at their slowest pace in over a year in October, increasing pressure on policymakers to restructure the $19 trillion export-oriented economy amid US trade tensions and weak domestic demand.

Declines in industrial production and consumption are accompanied by historically low levels of domestic investment. According to the National Bureau of Statistics, fixed-asset investment fell to 1.7% in the first ten months of the year, with Bloomberg Economics estimating a 12% drop in October alone, the fifth consecutive month of decline.

Financial markets: The economic calendar