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Jackson Hole poses bigger risk for investors than Nvidia earnings
Allspring’s Ann Miletti warned that a sharp rise in borrowing costs, with corporate rates moving from under 5% to above 5.5% this year, could pressure capital spending ahead of the Aug. 28 event.
Allspring Global Investments head of equity investments Ann Miletti said investors may face greater uncertainty from next week’s Jackson Hole economic symposium than from upcoming earnings from Nvidia, an AI bellwether. Speaking in a Bloomberg Television interview, Miletti argued that in a fast-changing market, investors should focus on what they can control, including companies’ balance sheet strength and flexibility across different environments.
Jackson Hole, hosted by the Federal Reserve Bank of Kansas City, is headlined by Fed Chairman Kevin Warsh and is scheduled for Aug. 28, two days after Nvidia reports. Miletti said expectations should be kept low going into the event because Treasury yields have risen since the Fed’s last policy meeting and because a Warsh press conference left many traders skeptical about the Fed’s willingness to act on inflation.
She pointed to corporate borrowing costs rising from below 5% at the start of the year to above 5.5%, noting that the key risk is the speed and sharpness of the move rather than the absolute level. The concern is amplified by bond market turbulence, including 30-year Treasury yields spiking to more than 5.3% before Treasury Secretary Scott Bessent’s decision to double a planned debt buyback to $4 billion, which provided only brief relief.
Miletti said she favors healthcare and small-cap industrials, adding that even as healthcare stocks have lagged, a rotation may be emerging as investors look to AI-driven innovation potential. She emphasized that amid market swings, assessing corporate balance sheets remains central to navigating the period.