London, UK – European stock futures, like their US and Asian counterparts, saw an increase following Nvidia Corp’s positive earnings report, which has bolstered optimism in the global artificial-intelligence industry.
Investor sentiment towards equities received a boost after Nvidia announced that its second-quarter revenue is expected to reach $28 billion, surpassing analysts’ predictions of $26.8 billion. Additionally, the company revealed a 10-for-1 stock split and a 150% increase in its quarterly dividend. This news also led to a surge in Asian chipmakers, with a Bloomberg gauge showing a 1.9% increase.
Experts like Rajat Agarwal, Asia strategist at Societe Generale SA in Bengaluru, believe that Nvidia’s strong earnings provide a positive outlook for Asian semiconductor stocks, extending the growth story and alleviating concerns of a slowdown in the industry.
While Japan’s stock benchmarks led the gains in Asia, Taiwan and South Korea also experienced increases in their equity markets. In South Korea, equities were further lifted after central bank Governor Rhee Chang Yong indicated that the potential for an interest-rate hike is currently limited. However, shares in Australia, China, and Hong Kong saw declines.
On the global front, Chinese stocks, particularly in the technology sector, faced challenges, with a drop in tech shares listed in Hong Kong due to a growing price war between Alibaba Group Holding Ltd. and Tencent Holdings Ltd. over cloud services.
In the currency markets, the dollar weakened against other major currencies, eroding some of its previous gains. The People’s Bank of China also cut its yuan fixing to the weakest level since January, affecting the Asian currency markets.
Furthermore, the ongoing strong earnings season in the US tech sector, along with positive forecasts for global tech earnings growth, underscores the importance of the semiconductor industry. Positive developments like Korea’s $19 billion incentive package to support its chip sector highlight the competition and investment opportunities in the market.
While gold prices declined following the Fed minutes, signaling a lack of readiness for interest rate cuts, other commodities like West Texas Intermediate also saw a slip. Copper prices took a hit due to signs of weakening demand.
As investors keep an eye on key events like the Eurozone S&P Global services and manufacturing PMIs and the G-7 finance meeting, market fluctuations are likely to continue, shaping the investing landscape in the coming days.
This article was produced with the help of automated data collection tools for enhanced reporting and analysis.