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Another dull day for the market, with the S&P 500 finishing up just 24 bps. The market spent the session waiting for Nvidia (NVDA), with hedges being put on throughout the day, which is why the VIX 1-day rose from around 8 to 15.

A VIX 1-day at only 15 heading into Nvidia seems low. It could be that the market wasn’t as concerned about the results as it has been in the past, or that it was simply starting from a lower base — it’s hard to say. Still, it implies a move of less than 1% tomorrow in the S&P 500.

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That said, Nvidia is trading lower following its results. Once again, the bar was high, and the numbers seemed carefully managed, with revenue of $46.7 billion versus estimates of $46.0 billion — a modest beat, especially given the company has typically exceeded expectations by a wider margin. From what I can tell, this was the smallest sequential increase the company has posted in several quarters.

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With the stock trading around $175 and implied volatility getting crushed, all those $180 calls will lose significant value tomorrow, and it seems only a matter of time before they get sold off this week. The stock also appears to have slipped into negative gamma after hours, which could change some of the dynamics. For now, support at $170 is key.

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In other market news, the 5-year CPI inflation swap broke out of a 2.5-year trading base to 2.65%. I’m not sure when it becomes fair to say inflation expectations are no longer well anchored, but based on this move, we have to think we’re getting close.

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Maybe we’re just waiting for the 10-year CPI swap to break out above 2.55% and confirm that double bottom — along with a break of the neckline — before saying inflation expectations have officially become unmoored.

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Finally, the 30-year minus the 2-year is moving, having cleared resistance at 1.25%, and now looks on pace to rise toward 1.6%. The question is what form it takes — the 2-year falling, the 30-year rising, or a combination of both. It’s hard to imagine 5- and 10-year inflation swaps trading higher without long-end rates eventually following. I’d think the combination move only lasts so long before the long end has to do the heavy lifting.

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