CNBC Daily Open: Nvidia fell, but that may be a good thing

It's the calamity of the overachieving child: You're expected not conscionable to ace each examination, but besides excel successful extracurricular activities.

So, erstwhile you're conscionable similar each different world genius with cleanable grades, that's simply the baseline you should beryllium hitting.

Such is the plight of Nvidia. Despite posting ridiculous gross maturation numbers that would nonstop immoderate different company's banal consecutive into the stratosphere, Nvidia's shares fell astir 6% yesterday.

The culprit: For the company's fiscal 2nd quarter, gross roseate "only" 122% connected an yearly basis, compared with 3 quarters of much than 200% year-over-year growth. The chipmaker's expected gross margins for the afloat twelvemonth were besides somewhat little than anticipated.

As Ryan Detrick, main marketplace strategist astatine Carson Group, wrote, "Death, taxes, and NVDA beats connected net are 3 things you tin slope on." In different words, conscionable beating net estimates isn't capable for Nvidia anymore. It's much astir "the size of the beat."

To beryllium fair, different companies look the aforesaid contented too, though possibly not connected the aforesaid magnitude arsenic Nvidia.

"When you person 75% oregon 80% of companies beating their estimates connected immoderate fixed quarter, that tells you it's not specified a peculiar happening anymore," said Interactive Brokers main strategist Steve Sosnick. "Beating estimates is nary longer a capable information for a post-earnings rally."

In immoderate case, Nvidia's nonaccomplishment yesterday whitethorn beryllium bully for the broader market. Hear maine out. Yes, the S&P 500 was mostly unchanged, portion the Nasdaq Composite slipped 0.23%. But the Dow Jones Industrial Average, buoyed by gains successful exertion stocks similar Apple and Microsoft, added 0.59% for a caller grounds close.

That suggests the tech assemblage and, indeed, the broader marketplace is relying little connected Nvidia for gains. The family, finally, isn't pinning each its anticipation connected 1 child.

CNBC's Arjun Kharpal, Kif Leswing, Fred Imbert and Lisa Kailai Han contributed to this report.