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NVIDIA and Amazon: 2 Growth Stocks to Buy as Inflation Eases
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Key Takeaways
NVIDIA could benefit as easing inflation supports AI spending and Blackwell platform deployments.
Amazon reported strong retail and AWS growth, with management guiding for higher second-quarter sales.
NVDA and AMZN are highlighted as growth stocks positioned to gain from a less restrictive rate environment.
The cooler-than-expected June Consumer Price Index (CPI) report has increased expectations that inflationary pressures are gradually easing, improving the outlook for sectors that are highly sensitive to interest rates and consumer spending. U.S. headline CPI rose 3.5% year over year in June, down from 4.2% in May, while core CPI slowed to 2.6%, signaling continued moderation in underlying price pressures. The report also showed the first monthly decline in headline prices since 2020, reflecting softer energy costs and broad-based easing across several categories.
Fed Holds Rates Steady, Rate-Cut Hopes Gain Momentum
While the Federal Reserve kept benchmark interest rates unchanged at its June policy meeting and reiterated that future decisions will remain data dependent, the latest inflation data has strengthened market expectations that the next policy move is more likely to be a rate cut than another hike if disinflation continues. Lower inflation also eases pressure on Treasury yields, improves financing conditions and supports equity valuations, particularly for sectors whose earnings and multiples are sensitive to borrowing costs.
Against this improving macro backdrop, two stocks that appear well positioned to benefit from easing inflation and the prospect of a less restrictive interest-rate environment are NVIDIA (NVDA - Free Report) from the technology sector and Amazon (AMZN - Free Report) from the consumer discretionary space.
Let’s get into more details.
Why Technology and Consumer Discretionary Stand to Benefit
Technology companies, particularly those tied to artificial intelligence, cloud computing and semiconductors, typically outperform when inflation moderates because lower interest-rate expectations increase the present value of future earnings and support premium valuations. At the same time, secular AI infrastructure spending by hyperscalers continues to provide a strong fundamental tailwind.
Consumer discretionary is another likely beneficiary. Cooling inflation improves consumers' purchasing power by reducing pressure on household budgets, while easing energy prices leave more disposable income available for discretionary purchases. Combined with a resilient labor market and steady wage growth, this environment could support higher spending across retail, travel, restaurants and leisure businesses.
Although policymakers continue to caution that inflation remains above the Federal Reserve's 2% target and additional data will determine the policy path, the June CPI report marks an important step toward a more favorable macro environment for growth- and consumption-oriented sectors.
Our Picks
NVIDIA: Its momentum continues to be driven by unprecedented demand for its Blackwell AI platform from hyperscalers, enterprises and sovereign AI projects. NVIDIA's latest guidance points to another quarter of robust revenue growth, supported by continued AI infrastructure investments despite export-related headwinds. As financing conditions improve, sustained enterprise AI spending and accelerating Blackwell deployments should support NVIDIA's near-term growth trajectory.
This Zacks Rank #1 (Strong Buy) stock has seen the Zacks Consensus Estimate for fiscal 2027 earnings increase by 11% over the past 60 days, reflecting analysts' growing confidence in sustained AI demand and Blackwell deployments. The full-year estimate of $9.09 indicates 90.6% growth over the fiscal 2026 reported number. You can see the complete list of today’s Zacks #1 Rank stocks here.
Image Source: Zacks Investment Research
Amazon: Amazon too is well positioned to benefit from easing inflation through both its consumer-facing retail operations and Amazon Web Services (AWS). Cooling price pressures could strengthen discretionary spending, while lower borrowing costs encourage enterprise cloud and AI investments. In first-quarter 2026, Amazon reported a 17% year-over-year increase in net sales with AWS revenues rising 28% year over year. Management guided second-quarter net sales of $194-$199 billion, reflecting confidence in continued demand across both retail and cloud businesses.
This Zacks Rank #2 (Buy) stock has seen the Zacks Consensus Estimate for 2026 earnings increase by 15% over the past 90 days, supported by AWS growth, advertising strength and improving retail margins. The full-year estimate of $8.93 indicates 24.6% growth over the 2025 reported number.
View the Zacks #1 Rank List
Image: Shutterstock
NVIDIA and Amazon: 2 Growth Stocks to Buy as Inflation Eases
Key Takeaways
The cooler-than-expected June Consumer Price Index (CPI) report has increased expectations that inflationary pressures are gradually easing, improving the outlook for sectors that are highly sensitive to interest rates and consumer spending. U.S. headline CPI rose 3.5% year over year in June, down from 4.2% in May, while core CPI slowed to 2.6%, signaling continued moderation in underlying price pressures. The report also showed the first monthly decline in headline prices since 2020, reflecting softer energy costs and broad-based easing across several categories.
Fed Holds Rates Steady, Rate-Cut Hopes Gain Momentum
While the Federal Reserve kept benchmark interest rates unchanged at its June policy meeting and reiterated that future decisions will remain data dependent, the latest inflation data has strengthened market expectations that the next policy move is more likely to be a rate cut than another hike if disinflation continues. Lower inflation also eases pressure on Treasury yields, improves financing conditions and supports equity valuations, particularly for sectors whose earnings and multiples are sensitive to borrowing costs.
Against this improving macro backdrop, two stocks that appear well positioned to benefit from easing inflation and the prospect of a less restrictive interest-rate environment are NVIDIA (NVDA - Free Report) from the technology sector and Amazon (AMZN - Free Report) from the consumer discretionary space.
Let’s get into more details.
Why Technology and Consumer Discretionary Stand to Benefit
Technology companies, particularly those tied to artificial intelligence, cloud computing and semiconductors, typically outperform when inflation moderates because lower interest-rate expectations increase the present value of future earnings and support premium valuations. At the same time, secular AI infrastructure spending by hyperscalers continues to provide a strong fundamental tailwind.
Consumer discretionary is another likely beneficiary. Cooling inflation improves consumers' purchasing power by reducing pressure on household budgets, while easing energy prices leave more disposable income available for discretionary purchases. Combined with a resilient labor market and steady wage growth, this environment could support higher spending across retail, travel, restaurants and leisure businesses.
Although policymakers continue to caution that inflation remains above the Federal Reserve's 2% target and additional data will determine the policy path, the June CPI report marks an important step toward a more favorable macro environment for growth- and consumption-oriented sectors.
Our Picks
NVIDIA: Its momentum continues to be driven by unprecedented demand for its Blackwell AI platform from hyperscalers, enterprises and sovereign AI projects. NVIDIA's latest guidance points to another quarter of robust revenue growth, supported by continued AI infrastructure investments despite export-related headwinds. As financing conditions improve, sustained enterprise AI spending and accelerating Blackwell deployments should support NVIDIA's near-term growth trajectory.
This Zacks Rank #1 (Strong Buy) stock has seen the Zacks Consensus Estimate for fiscal 2027 earnings increase by 11% over the past 60 days, reflecting analysts' growing confidence in sustained AI demand and Blackwell deployments. The full-year estimate of $9.09 indicates 90.6% growth over the fiscal 2026 reported number. You can see the complete list of today’s Zacks #1 Rank stocks here.
Image Source: Zacks Investment Research
Amazon: Amazon too is well positioned to benefit from easing inflation through both its consumer-facing retail operations and Amazon Web Services (AWS). Cooling price pressures could strengthen discretionary spending, while lower borrowing costs encourage enterprise cloud and AI investments. In first-quarter 2026, Amazon reported a 17% year-over-year increase in net sales with AWS revenues rising 28% year over year. Management guided second-quarter net sales of $194-$199 billion, reflecting confidence in continued demand across both retail and cloud businesses.
This Zacks Rank #2 (Buy) stock has seen the Zacks Consensus Estimate for 2026 earnings increase by 15% over the past 90 days, supported by AWS growth, advertising strength and improving retail margins. The full-year estimate of $8.93 indicates 24.6% growth over the 2025 reported number.
Image Source: Zacks Investment Research