6 days ago
Nvidia Earnings Lift US Futures as Rate Concerns Persist
US stock futures went up after Nvidia reported very strong sales.
Nvidia makes important computer chips used for artificial intelligence.
Its shares rose about 7% before regular trading began.
Other chip companies also saw their shares rise.
Investors felt more confident that the AI boom might continue.
However, inflation was still higher than some investors expected.
This made people worry that the Federal Reserve could raise interest rates.
Oil prices also recovered as Iran and Oman discussed temporary shipping routes through the Strait of Hormuz.
Nasdaq futures rose 1% and S&P 500 futures gained 0.4% on Thursday, while Dow futures edged lower.
Nvidia shares jumped 7% before the opening bell after quarterly revenue more than doubled to $96.2 billion.
Nvidia’s data-center revenue reached $89 billion, up 117% year over year, while edge-computing revenue rose 27% to $7.2 billion.
Advanced Micro Devices, Arm Holdings, Qualcomm, Micron Technology, and Intel also traded higher, gaining as much as 4%.
Investors remained focused on elevated inflation, stronger economic growth, potential Federal Reserve rate increases, and developments affecting oil shipments through the Strait of Hormuz.
- Who
- Nvidia, other chipmakers, investors, the Federal Reserve, and officials from Iran and Oman were central to the developments.
- What
- Strong Nvidia earnings lifted US stock futures and semiconductor shares, while inflation, interest-rate expectations, and oil-shipping developments shaped broader markets.
- Where
- US financial markets, with related shipping discussions involving the Strait of Hormuz, Iranian waters, and Omani waters.
- When
- Thursday, 27 August; the article also refers to Nvidia’s May-July quarter and upcoming events later that week.
- Why
- Nvidia’s results and optimistic outlook boosted confidence in artificial-intelligence demand, while inflation, economic growth, and possible supply disruptions influenced other markets.
Market Optimism
Economic and Rate Concerns
Artificial-intelligence rally
Market Optimism
Nvidia’s stronger-than-expected results and outlook suggested accelerating demand for AI accelerators and supported gains across chip stocks.
Economic and Rate Concerns
Investors remained concerned about whether the AI-driven rally could be sustained and whether it represented a potential economic bubble.
Interest-rate outlook
Market Optimism
The strong economy and Nvidia-led technology gains provided support for broader market sentiment.
Economic and Rate Concerns
Higher-than-expected inflation and revised economic growth increased expectations of a Federal Reserve rate increase by December, pushing bond yields higher.
Strait of Hormuz shipping
Market Optimism
A potential Iran-Oman arrangement could gradually ease concerns about supply disruptions and support a recovery in oil trading.
Economic and Rate Concerns
The proposed routes were described as temporary, with a permanent maritime traffic plan still requiring further discussions.
Key facts
- Nasdaq futures
- Up 1%.
- S&P 500 futures
- Up 0.4%.
- Nvidia quarterly revenue
- $96.2 billion, more than double the prior-year figure.
- Nvidia data-center revenue
- $89 billion, up 117% year over year.
- Nvidia edge-computing revenue
- $7.2 billion, up 27% year over year.
- Inflation measure
- The Federal Reserve’s historically preferred measure stood at 3.7% last month, unchanged from June.
- US economic growth
- The economy expanded at a revised 1.5% annualized pace during April-June.
- Oil prices
- US crude rose $0.17 to $82.46 per barrel, while Brent gained $0.48 to $87.40.
Sources
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