The Macro Minute: Did NVIDIA and Walmart signal enough to support a continuation of the rally?

Added: 2026-05-22

[00:00:00]Happy Thursday out there, team 42. It's your skipper here, Darius Delta, presenting our macro minute for Thursday, May 21st, 2026. As always, we'll start with the executive summary from today's lead-off morning note. So, let's dive right in. Today's key macro question is, did Nvidia and Walmart signal enough to support a continuation of the rally? Our answer is no. Nvidia's guidance was disappointing and signaled headwinds from increasing competition and investor concentration. Walmart's results signal that burgeoning inflation pressure is eroding corporate margins in the real economy and that massive AI-related investment demand may be contributing to those inflation pressures. All told, investors may be looking to take profits anyway to free up capital for massive tech IPOs on deck and a Federal Reserve that will likely pivot in a hawkish manner over the medium term.

[00:00:49]As always, we'll transition to our 42 macro dashboard here. We'll wrap up with the question from our community. This one's titled, "Gold in the current highest probability correction scenarios." So, 42 friends, I know the just kick back and chill mantra as well.

[00:01:01]I follow the advice daily. But, my curiosity remains and I've not yet learned enough to parse potential outcomes myself, hence my membership here. So, what's the modal outcome of a realized material cross-asset correction in the two to three catalyst scenario DD laid out yesterday? Uh number one, the Fed abandons its inflation mandate and rejects the bond market signals. Number two, the Fed tightens and heeds the bond market signals. And number three, the straight up removes fully reopens. Is one plus three more bullish versus two plus three? As tightening will squeeze liquidity and two is essentially a continuation of running the economy hot.

[00:01:32]Um so, apologies if the for the implications obvious to you 42 pros out there, but I appreciate any explanation.

[00:01:37]So, uh you know, before I even answer the question, the one thing I would say is there are no dumb questions in our community chat with the exception of those that have already been answered uh by our education materials, which obviously our subscribers know they can access here from the hamburger menu uh here in the dashboard. Any question that hasn't been answered already in those education materials is a wise question because that's how we learn. You cannot have fear for asking questions. It's the smartest people in the world, the people I respect the most around the global Wall Street, who I've been in meetings with, ask the most questions. And that's why I'm a naturally inquisitive One of the reasons why I'm a naturally inquisitive inquisitive and curious person even this far into my career cuz I don't believe you can ever stop learning because this game is constantly evolving and you need to constantly evolve alongside it if your goal is to remain on the right side of market risk. So, just getting into the questions, you know, if you can sort of combine those scenarios and from my perspective, there are really four different scenarios when you sort of combine these two outcomes because two of them are mutually exclusive. And so, I would say the most bullish scenario is a combination of number one being the Fed abandoning its its inflation targeting or at least on a temporary basis plus scenario number three, which is the straight or most fully reopens. That's how you get a broadening, you know, continuation of the equity rally and more importantly, you could actually start to see the stock market potentially bubble in the scenario where the Fed is looking through inflation pressures and and then really rejecting signals from the bond market to continue supporting administration that is trying to run the economy hot and it is doing so successfully at the current juncture.

[00:03:12]The second most bullish scenario would be just number one in isolation with the straight or most remaining closed.

[00:03:18]That's how you get continuation of the narrow equity rally, probably not a bubble in that scenario because of the liquidity cycle concerns for the straight remaining closed followed by number two plus three. So, if you got the Fed accepting the bond market signals and tightening policy with the straight or most reopening, that's how you probably get that's how you get a moderate correction, a manageable correction, but ultimately that dip will be bought because the markets will start to look ahead to you know, the Fed getting inflation under control and more importantly, positive developments from the spectrum of the liquidity cycle with the straight reopening. And then obviously the most bearish is just number two in isolation with the Strait of Hormuz uh remaining closed cuz then you're just having a a bid, you know, that's essentially taking away the punch bowl at the margin with a continuation of the build-up of those liquidity uh headwinds uh coming out of the strait.

[00:04:07]So, I hope that was helpful and obviously when we talk about uh the questions about gold, but in my opinion, I think you can copy and paste uh those views on gold, uh everything I just said to the equity market, everything I just said to uh the crypto uh asset class as well. So, we'll wrap it up there. Darius here representing our Macro Manic for Thursday, May 21st, 2026. Best of luck out there today. We'll catch back here tomorrow. Cheers.