Global Markets Rally After Nvidia's Blowout Earnings
Global markets are on the rise and US equity futures are sharply higher, which could push the S&P to a new all-time high. This comes after Nvidia's impressive earnings reassured investors that the global artificial-intelligence juggernaut will continue to drive equity markets. As of 7:30am, S&P futures were 0.6% higher and Nasdaq futures gained 1.0% entirely due to Nvidia's stunning results. The company not only raised its Q2 revenue guidance to a consensus-busting $28BN but also announced a 10:1 forward stock split.
European Bond Markets Unmoved by PMI Report
Elsewhere, the Bloomberg’s dollar index retreated after touching a one-week high while US Treasuries inched higher after losses on Wednesday. European bond markets showed little reaction to the latest PMI report that revealed private-sector business activity at its highest in a year in the euro area, suggesting an economic rebound is taking hold. Oil was flat; bitcoin traded around $70k while Ethereum looked poised to break above $4,000 on today's SEC approval of an ETH ETF.
Nvidia's Earnings Lift Tech Stocks
In premarket trading, tech stocks were all the rage, thanks to Nvidia, whose shares rose 7% adding nearly $200 billion to its market cap. The company is poised to add to its 90%-plus year-to-date rally after it reported first-quarter results that beat expectations and gave an outlook that was seen as strong. The company also announced a stock split and increased its dividend. The optimism also lifted peers such as Super Micro Computer and AMD.
Other Notable Premarket Movers
Other notable premarket movers included DuPont shares which climbed 5% after the chemical company announced plans to split into three publicly traded companies. Morgan Stanley said this was a “logical decision.” Elf Beauty shares advanced 0.6% after the cosmetics company reported fourth-quarter adjusted earnings per share and net sales that came ahead of consensus estimates. Although the company also issued annual projections for sales and profit that didn’t meet expectations, analysts are generally positive on the print.
AI's Growing Importance
“This is another important milestone in the AI journey,” said Guy Miller, chief market strategist at Zurich Insurance Company. “Top-performing companies have to deliver and Nvidia has delivered.” The earnings offer clear evidence of the growing importance of AI, and “that’s going to keeping this juggernaut going,” Miller said.
European Stocks Rise
European stocks also rose but losses in utilities, real estate and telecommunication names have capped gains. The Estoxx 50 gains 0.5% in early London session with info tech names leading the move higher as NVDA boosted the region’s semiconductor sector. Meanwhile, UK utilities and homebuilders fall after Prime Minister Rishi Sunak unexpectedly announced the general election for July 4 rather than in the autumn.
Final Thoughts
The recent market rally, driven by Nvidia's impressive earnings, highlights the growing importance of artificial intelligence in the global economy. As top-performing companies continue to deliver, it's clear that this trend is set to continue. What are your thoughts on this development? Do you think AI will continue to drive market growth? Share this article with your friends and sign up for the Daily Briefing, which is everyday at 6pm.
