(Bloomberg) — Global stocks rallied, with Japan’s benchmark hitting a record high and Europe’s on track to do the same, after Nvidia’s blowout sales forecast reinforced investor conviction in the boom in generative AI use.
Most Read from Bloomberg
The Nasdaq 100 index futures jumped 2% and S&P 500 contracts were up more than a percent, suggesting the rally will carry over to Wall Street. Nvidia soared as much as 13% in pre-market trading after it said first-quarter revenue would likely hit $24 billion, above prior estimates of around $22 billion.
Japan’s Nikkei 225 Index closed above a peak last achieved in 1989, driven by gains in technology shares and chip-gear producers. The Stoxx Europe 600 index surpassed its January 2022 closing high, with the tech sector surging more than 3% and the region’s biggest chipmaker, ASML Holding NV, climbing as much as 5%. A gauge of Asian shares rose to its highest level in almost two years.
“As goes Nvidia, so goes the market,” said Kim Forrest, chief investment officer of Bokeh Capital Partners LLC. “It does confirm the narrative that AI is going to continue to be strong for the foreseeable future. This narrative supported the markets last year, why wouldn’t it do the same this year?”
The hype around Nvidia’s earnings overshadowed a hawkish tone to the minutes of the Federal Reserve’s last policy meeting, where most officials expressed concern about the risk of cutting interest rates too soon. Fed Governor Lisa Cook and Minneapolis Fed President Neel Kashkari are set to speak today, providing investors with more food for thought along with jobs and home sales data.
Treasuries were steady after a selloff that pushed the 10-year yield five basis points higher on Wednesday. A gauge of the dollar declined for a fourth day.
Story continues
Euro-area private-sector activity hit an eight-month high, with services and stabilizing numbers across most of the region making up for an increasingly dire situation in German manufacturing. Bonds across the euro region fell as traders trimmed bets on rate cuts by the…
..
