Welcome back, Financial enthusiasts. The AI chip market is heating up as Nvidia faces a new competitor.

Alibaba is testing a new AI chip for inferencing, which could present a significant challenge to Nvidia and AMD, especially in the Chinese market. As geopolitical risks rise and concerns about customer concentration emerge, how will Nvidia maintain its dominance in the face of this growing competition?

In today’s financial recap:

AI chip wars intensify as Alibaba challenges Nvidia
US core PCE inflation reinforces September Fed rate cut expectations
Ethereum ETFs attract massive inflows, targeting $20K
Aurora and McLeod streamline autonomous truck management

Nvidia Faces Rising Competition Amid AI Chip Market Shifts

The TradeWatch: Nvidia’s stock is down amid concerns of customer concentration, geopolitical risks, and competition from Alibaba’s new AI chip, signaling a shift in the AI hardware landscape.

Unpacked:

Nvidia’s stock dropped more than 3% on Friday, contributing to a weekly loss, following a tepid investor reaction to its recent earnings report.
Nvidia’s stock down more than 3% on Friday.
The Wall Street Journal reported that Alibaba is testing a new chip for AI inferencing, which presents a direct challenge to Nvidia and AMD in China.
Dell’s lower-than-expected third-quarter earnings outlook, guiding to $2.45 EPS, further weighed on chip stocks, as Dell accounts for over 2% of Nvidia’s revenue on an annualized basis.

Bottom line: The increasing competition and geopolitical pressures highlight the need for diversification in AI infrastructure investments. It is important to closely monitor how these market shifts will impact both Nvidia’s future performance and the broader AI hardware supply chain.

US Core PCE Inflation Steady at 2.9%, Reinforcing September Fed Rate Cut Expectations

The TradeWatch: July’s US Core PCE inflation matched expectations at 2.9%, reinforcing the Federal Reserve’s cautious stance and strong market anticipation of a September rate cut.

Unpacked:

July’s core PCE Price Index, excluding volatile food and energy prices, rose 2.9%, matching estimates and following June’s 2.8% increase.
The US Bureau of Economic Analysis reported that Personal Income increased by 0.4% in July, while Personal Spending expanded by 0.5%.
The steady inflation data, combined with robust consumer spending, keeps alive expectations of a 25 basis point rate cut in September, limiting the US Dollar’s upside in the near term.

Bottom line: The steady core PCE inflation data supports expectations for a September rate cut by the Federal Reserve, as the central bank navigates balancing price pressures and economic growth. The market reaction remains muted, with the US Dollar Index reclaiming ground near the 98.00 level.

Ethereum ETFs Attract Massive Inflows; $ETH Targets $20K

The TradeWatch: Institutional investors are flocking to Ethereum ETFs, pouring $4 billion into them in August alone, signaling a shift in digital asset preference beyond Bitcoin. This surge reflects growing confidence in Ethereum’s role in tokenization, stablecoins, and staking.

Unpacked:

Ethereum ETFs experienced a “relentless bid,” potentially reaching $50 billion in annualized flow, surpassing last year’s Bitcoin ETF inflows, according to Bitwise Asset Management CIO Matt Hougan.
Institutional investors are increasingly drawn to Ethereum due to regulatory clarity that should solidify stablecoin dominance and the potential $19 trillion tokenization boom.
Data from SoSoValue shows that Ethereum ETFs raked in $4 billion in August alone.

Bottom line: The substantial inflows into Ethereum ETFs demonstrate growing institutional confidence in Ethereum’s technology and market position. As Ethereum solidifies its role in emerging financial infrastructures like tokenization, its price could reach new heights, further attracting investors seeking exposure to blockchain-based assets.

Aurora & McLeod Streamline Autonomous Truck Management

The TradeWatch: Aurora’s collaboration with McLeod Software integrates autonomous trucking into existing transportation management systems, which enhances operational efficiency and aims to accelerate the adoption of self-driving trucks throughout the industry.

Unpacked:

This partnership enables McLeod’s clients to gain real-time insights into autonomous truck operations through an API integration with Aurora’s technology.
Shared customers can manage the tendering and acceptance of autonomous shipments, dispatch, and load tracking directly through their McLeod TMS.
McLeod anticipates making this feature available to its customers by 2026, with Aurora participating in McLeod’s User Conference from 21-23 September 2025 to provide updates.

Bottom line: This integration underscores the importance of cutting-edge technology in optimizing operations for transportation companies and embracing innovation. It offers a pathway for these companies to adopt autonomous tractors within their operations with confidence.

The Shortlist

Alibaba missed Non-GAAP EPADS estimates by $0.14, while revenue also fell short of expectations by $910M.
FieldAI secured $405 million in funding, backed by NVIDIA which underscores strong investor confidence in the AI-driven automation of robotics.
Boardwalktech reported Q1 results with a GAAP EPS of -$0.01 and revenue of $0.9M, a 30.8% year-over-year decrease.