CHRIS VERSACE: Good morning, Action Alerts Plus members. It's Thursday, August 25. And as we start today's training, we received a bunch of economic data, including revisions for the GDP for the second quarter. Parsing the data, we find that the economy looks to have been stronger than initially expected, but inflation pressures were also stronger than the preliminary findings.
Let's remember that during the last FOMC press conference, Fed Chair, Powell, said the Fed tends to favor these revised figures over the initial readings. This more than likely means that the Fed will see the economy is holding up better than expected, and it can swallow larger rate hikes in order to get inflation back down to the Fed's 2% target.
All of this, sets the table for Powell's appearance tomorrow at Jackson Hole. And we expect the market to be leaning into his comments to see if they're more hawkish or dovish. With the market, and essentially in no man's land between now and then, it means that indeed Powell's comments are going to be the next big catalyst for the market.
Last night, we got earnings from Nvidia. The company reported a mixed July quarter, cut expectations for the current one amid continuing pressures in the gaming market. We warned members that this was likely to happen a few days ago. We also trimmed back the portfolio's position at that time in Nvidia's shares.
Today, we're seeing price targets come down almost across the board. And the question is, while we still hold some Nvidia, are we likely to jump back into the shares in the near term? And the answer is more likely than not no. What we really want to see is the gaming market bottom out. That could be this quarter, that could be next quarter. But at least in the near term, we for sure that it's going to remain a drag on the business even though data center continues to be strong.
Now how are we going to determine this bottoming in the gaming market? Well, we're going to listen to the usual data points. But we're also going to pay close attention to what Dell has to say tonight when it reports its earnings after the close. And then again, next week when HP does the same.
We'd also point out to that last night Salesforce reported, and it really reaffirms some of the comments that we shared with members earlier in the week about dollar headwinds, but also about concerns that the economic cycle and where we are in the economy with the slowing data is going to have an impact on corporate spending. Simply put, Salesforce reaffirmed both of those concerns last night. It also has us increasingly confident about the move that we made earlier this week by adding to the ProShares short QQQ or the PSQ position in the portfolio.
Now on a positive note, Splunk, a constituent of the first trust NASDAQ cybersecurity ETF, better known to members as cyber, delivered a upbeat quarter last night, another beat and raise. And it really speaks to the strength that we're seeing in cybersecurity spending, and reaffirms our view that, yes, cybersecurity is indeed a growth market. We expect more of the same when two more constituents report next week, keeping us increasingly bullish on cyber shares. That's a wrap for today's rundown. Thanks for joining us. We'll be back with you tomorrow.