Finance

Nvidia shares surge after announcing artificial intelligence has reached ‘tipping point’


(Bloomberg) — A rally in global stocks will extend into Europe as Nvidia’s blowout sales forecast reaffirms investor confidence in technology and semiconductor companies amid a boom in artificial intelligence applications.

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Euro Stoxx 50 futures were trading near 0.9%, tracking similar gains in Asian stocks and U.S. stock futures contracts. Japanese stocks rose, with the Nikkei 225 closing at a record high set in 1989, driven by gains in technology and chip stocks. Gear manufacturer.

Charu Chanana, strategist at Saxo Capital Markets, said: “After the recent consolidation, Nvidia’s earnings turnaround is the perfect catalyst for Japanese stocks to reach record highs. From geopolitics to corporate reforms “Structural drivers, as well as yen weakness, will persist. “Suggesting that Japanese stocks are a macro-meets-momentum story, but the peak is still quite far away,” she said.

Stocks in South Korea, Taiwan and China also rose, with an Asian stock index rising to its highest in nearly two years.

U.S. stock index futures rose sharply in Asian trading after Nvidia reported earnings. The technology company said first-quarter revenue could hit $24 billion, up from its previous forecast of about $22 billion, and its shares soared 11% in after-hours trading.

The results were expected to provide a catalyst for global equity markets and delivered on their promise. Nvidia’s Asian supplier SK Hynix Inc jumped to a 24-year high, while Advantest Corp hit a record high.

Kim Forrest, chief investment officer of Bokeh Capital Partners LLC, said: “Nvidia has grown and the market has grown. It looks like the results are good enough. This does confirm that artificial intelligence will continue to have strong momentum.” “For the foreseeable future. That narrative supported the market last year, why can’t it do the same this year?”

Mainland China’s stock market is enjoying its longest rise since 2020 after authorities recently took a series of measures to stabilize the market and boost investor sentiment. The CSI 300 and Hang Seng indexes rose as the China Securities Regulatory Commission tightened its grip on the stock market. According to people familiar with the matter, the market previously issued an order prohibiting major institutional investors from reducing their stock holdings at the opening and closing of each trading day.

“We think the government will continue to implement supportive policies, which will have a positive spillover effect on Asia. For Asia, GDP growth will be better than Last year compared to the rest of the world.”

Asian investors are returning to optimism at the end of 2023, with January’s losses expected to be overcome this month, driven by China’s economic recovery and gains in Japan. Expectations of improved earnings from technology led by the region’s chipmakers also boosted investor confidence. The attractiveness of stocks on the African continent.

The dollar fell against the Group of 10 currencies. The yen was largely unchanged at around 150 to the dollar, while the South Korean won gave up gains following comments from Bank of Korea Governor Lee Chang-dye following the Bank of Korea’s decision to keep key interest rates unchanged. .

Chinese bonds held steady in Asian trade after a sell-off on Wednesday pushed 10-year yields up 5 basis points. Selling pressure was seen across the curve following the sale of $16 billion in 20-year bonds and the release of the Fed’s minutes, signaling caution about rate cuts.

Richmond Fed President Thomas Barkin stressed that while overall inflation is declining, sectors such as real estate still face continued price pressures. Meanwhile, Federal Reserve Governor Michelle Bowman opposed the prospect of an imminent rate cut.

Economic data due later on Thursday include euro zone inflation and purchasing managers’ indexes, as well as U.S. jobless claims and home sales.

Elsewhere, Nestle SA expects revenue growth to slow as easing inflation will lead to slower price increases to stimulate consumption, while Mercedes-Benz Group said it expects returns to fall this year due to a slowdown in the global economy.

West Texas Intermediate crude oil rose 1.1% on Wednesday to hit the $78 a barrel mark, supported by tighter physical supplies. Gold climbed above $2,029 an ounce. Bitcoin stabilized after falling on Wednesday.

Main events this week:

  • Eurozone S&P Global Services PMI, S&P Global Manufacturing PMI, CPI, Thursday

  • U.S. jobless claims, U.S. existing home sales, Thursday

  • ECB releases minutes of January meeting on Thursday

  • Fed Lisa Cook and Minneapolis Fed President Neel Kashkari speak Thursday

  • China house prices on Friday

  • German IFO Business sentiment, GDP, Friday

  • The European Central Bank releases one- and three-year inflation expectations surveys on Friday.

Some major trends in the market:

stock

  • S&P 500 futures were up 0.8% as of 3:22 p.m. Tokyo time

  • Nasdaq 100 futures rise 1.5%

  • S&P/ASX 200 futures little changed

  • Hong Kong’s Hang Seng Index rose 0.7%

  • The Shanghai Composite Index rose 0.9%

  • Euro Stoxx 50 futures rose 0.8%

currency

  • The Bloomberg Dollar Spot Index fell 0.1%

  • EUR/USD rose 0.2% to $1.0837

  • The yen exchange rate was little changed at 150.24 yen per US dollar.

  • The offshore yuan exchange rate was little changed at 7.1980 per US dollar.

cryptocurrency

  • Bitcoin rises 0.4% to $51,578.65

  • Ethereum rises 0.3% to $2,935.21

bond

commodity

  • West Texas Intermediate crude rose 0.3% to $78.18 a barrel

  • Spot gold rose 0.2% to $2,029.92 an ounce

This story was produced with the assistance of Bloomberg Automation.

——With the assistance of Winnie Hsu.

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