TLDR
- Nvidia is investing $3.5 billion in MediaTek through convertible bonds to expand its AI ecosystem
- Oil prices rose over 2% above $90 a barrel after U.S. forces struck Iranian targets
- PG&E fell around 18% on renewed wildfire liability concerns in California
- GameStop rose despite forecasting a drop in quarterly revenue to between $780 million and $800 million
- Broadcom earnings and Friday’s jobs report are the next major market events to watch
Wall Street kicked off the week with several big stock moves and fresh geopolitical tension shaking energy markets.
Nvidia Expands AI Reach With MediaTek Deal
Nvidia is investing $3.5 billion in MediaTek through convertible bonds. The deal will let MediaTek customers access Nvidia’s NVLink Fusion technology.
The two companies are also working together on AI PCs, automotive systems and data-center chips.
This is part of a broader Nvidia strategy to grow beyond selling GPUs. The company has been using partnerships to build a wider AI ecosystem around its technology.
The deal shows how AI computing is spreading across more types of devices and platforms.
Oil Jumps After U.S.-Iran Military Action
Oil prices rose sharply after U.S. forces struck Iranian targets on Larak Island. Brent crude climbed more than 2% and moved back above $90 per barrel.
Attention quickly turned to the Strait of Hormuz, a key global oil transit route.
Any disruption there could push crude prices higher. Higher oil prices can hurt manufacturers and transport companies, and could also make it harder for the Federal Reserve to cut interest rates.
PG&E Falls on Wildfire Liability Fears
PG&E dropped around 18% on Monday, one of the biggest single-stock declines of the day.
Investors reacted to renewed concerns about wildfire liability in California. For utility companies, major fire events can lead to large legal and insurance costs.
The drop also weighed on the broader utilities sector. Investors will be watching for updates on what financial exposure PG&E may actually face.
GameStop Climbs Despite Sales Warning
GameStop said it expects second-quarter revenue of between $780 million and $800 million. That compares to $972.2 million in the same period last year.
Store closures and an exit from France are behind the drop.
Despite the weak sales outlook, the stock moved higher. Investors focused on the company’s decision to use cash to repay part of a $1.4 billion debt exchange. That could reduce the risk of shareholder dilution down the road.
Broadcom and Jobs Report in Focus
Two big events are coming up for markets. Broadcom is set to report earnings, and Friday brings the August jobs report.
Broadcom is closely watched for its role in AI infrastructure, including custom accelerators and high-speed networking. Its results will give investors a read on whether big tech spending on AI remains strong.
Economists expect around 55,000 jobs were added in August, after an unexpected drop in July. A strong number could push expectations for another Federal Reserve rate increase. A weak number could ease that pressure.
Both events could set the tone for markets into the end of the week.
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