The Market News Today: Nvidia’s Robust Performance Signals Strong AI Chip Demand

James Hyerczyk
Updated: May 23, 2024, 12:22 GMT+00:00

Key Points:

  • Nvidia's First-Quarter Earnings Surpass Expectations
  • Fed Expresses Inflation Concerns, Considers Further Rate Hikes
  • Nasdaq-100 Futures Rise on Nvidia's Performance
  • Dollar Stable, Mixed Performance in Commodities Amid Rate Hike Speculation
  • Ethereum ETF Approval Likely, Market Anticipates Positive Outcome
The Market News Today

Nvidia Shares Surge After Earnings Beat

Nvidia is soaring as its first-quarter earnings and sales surpass expectations. The company’s shares are climbing over 7%, topping $1,000 for the first time. Nvidia is anticipating second-quarter sales of $28 billion, exceeding Wall Street forecasts. The chipmaker is also planning a 10-for-1 stock split. The company’s robust performance highlights strong demand for AI chips, with data center revenue jumping 427%. Nvidia’s next-generation AI chip, Blackwell, is expected to boost future growth.

Fed Officials Express Inflation Concerns, Potential for Further Rate Hikes

The Federal Reserve is expressing concerns over the lack of progress in curbing inflation, as minutes from the latest meeting show. Officials are considering further policy tightening if inflation risks persist. The benchmark borrowing rate remains between 5.25% and 5.5%. Despite some recent easing in inflation, members are cautious about easing rates too soon, reflecting uncertainties in achieving the 2% target. Market expectations for rate cuts have also been adjusted.

Nasdaq-100 Futures Jump as Nvidia’s Strong Results Boost Market Confidence

Nasdaq-100 futures are rising by 0.9% as Wall Street evaluates Nvidia’s strong quarterly performance. S&P 500 futures are up 0.5%, and Dow Jones Industrial Average futures are increasing by 29 points. Nvidia shares surge 6% in extended trading, surpassing $1,000, following impressive first-quarter results and a 10-for-1 stock split. Nvidia’s fiscal second-quarter revenue forecast of $28 billion exceeds expectations. Snowflake also rises 4% on revenue beat. Nvidia’s results bolster confidence in AI sector and market outlook. The price action suggests investors are shrugging off the Fed’s hawkish outlook.

Dollar Steady, Crude Oil Mixed, Gold Dropping Amid Fed Rate Speculation

The dollar is hovering near a one-week high after the Fed minutes reveal possible interest rate hikes. Crude oil is showing mixed performance, with gains capped by potential Fed tightening impacting demand. Gold prices are falling for a third session as Fed minutes indicate some officials favor raising rates. The anticipation of further rate hikes supports the dollar, affects oil demand, and increases the opportunity cost of holding non-yielding gold.

SEC Likely Approving Ethereum ETF, Cryptocurrency Market Anticipates Decision

Cryptocurrency research firm 10x Research is raising the likelihood of the SEC approving the Ethereum spot ETF to 90%. The firm views the approval as a formality, predicting an announcement around 13:00 GMT. The Grayscale Ethereum Trust’s discount to NAV narrowing to 8% suggests a high approval probability. VanEck’s spot Ether ETF listing by DTCC supports this optimism. Ethereum co-founder Jeffrey Wilcke’s significant ETH transfer to Kraken hints at potential market movements.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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