Moving markets today: Asian shares mixed after US stock dip, Nvidia surges 6 per cent; BHP declines after Anglo American rejects third takeover bid, oil prices fall; All eyes on UK-US PMI data
US stocks dipped as investors parsed through the latest Federal Reserve meeting minutes. However, Nvidia’s shares surged around 6 per cent after the company issued a revenue forecast that exceeded expectations. In the Asia-Pacific region, markets showed a mixed response to concerns raised by Fed officials about ongoing inflation, causing uncertainty about potential interest rate adjustments. Oil prices fell amid worries about increased US interest rates, while gold prices remained lacklustre following a recent dip, as traders adjusted their expectations for Federal Reserve rate cuts this year. BHP shares declined after Anglo American rejected its third proposal and extended the bid deadline. Investors are eagerly awaiting the May Purchasing Managers’ Index (PMI) reports from both the UK and the US for insights into economic health amid inflationary pressures. Retailers like Ross, Dollar Tree, and Deckers are gearing up to release their quarterly earnings reports, which are expected to shed light on consumer behaviour. Additionally, Atlanta Fed President Raphael Bostic is slated to discuss the outlook for future rate cuts. Here are five key takeaways for your day.
Nvidia’s revenue skyrockets 262 per cent on surging AI chip demand, shares cross $1,000 milestone
Nvidia exceeded expectations with its quarterly revenue forecast and stock split announcement on Wednesday, driving its shares to a record high. The chipmaker’s stock surged 5.9 per cent to $1,005 in extended trading, surpassing $1,000 for the first time and adding approximately $140 billion to its market value.
Nvidia reported earnings per share of $6.12 and sales of $26 billion for the quarter ending April 30, far surpassing analysts’ forecasts. This marked Nvidia’s most profitable and highest sales quarter ever, with profits and revenues soaring compared to the same period last year.
BHP shares drop as Anglo American rejects third takeover bid
Australia’s BHP Group saw its shares fall over 3 per cent on Thursday after its third takeover bid for Anglo American was rejected. Anglo American agreed to a one-week extension for BHP to submit a binding offer. BHP now has until May 29 to make a binding offer or face a mandated six-month pause in acquisition pursuit under UK takeover rules.
Japanese factory output sees first growth in a year
Japan’s factory activity showed signs of growth for the first time in a year this May, according to a business survey released on Thursday. The au Jibun Bank flash manufacturing purchasing managers’ index (PMI) increased to 50.5 in May from 49.6 in April, surpassing the 50.0 mark that indicates expansion, a level it hadn’t reached since last May.
What’s on the radar
Several retailers, such as Ross, Dollar Tree, and Deckers, are gearing up to report their quarterly earnings, offering insights into consumer behaviour.
Meanwhile, the May Purchasing Managers’ Index (PMI) reports from the UK and the US will be released, providing a clearer picture of the economies’ health as they battle ongoing inflation.
Additionally, all eyes will be on the US Federal Reserve, with Atlanta Fed President Raphael Bostic scheduled to discuss the central bank’s outlook on future rate cuts.
Asian stocks mixed as US Fed flags inflation challenges
The Dow Jones Industrial Average dropped 0.51 per cent to finish at 39,671.04, the S&P 500 declined 0.27 per cent to 5,307.01, and the Nasdaq Composite, known for its tech stocks, slipped 0.18 per cent to 16,801.54. The Russell 2000, which focuses on smaller companies, fell 0.9 per cent.
On the brighter side, chipmaker Analog Devices saw its shares jump 10.86 per cent after predicting higher-than-expected revenue for the third quarter. However, the energy sector performed the worst, losing 1.83 per cent as oil prices declined for the third consecutive session. Retail giant Target saw its stock tumble 8.03 per cent due to disappointing quarterly earnings and forecasts.
In Asian markets, Japan’s Nikkei rose 0.7 per cent, supported by a weaker yen hitting its lowest point in over three weeks at 156.85 per dollar. Taiwan’s stock market had a modest gain of 0.15 per cent. On the other hand, Hong Kong’s Hang Seng Index dropped 1.91 per cent as investors took profits after it hit a nine-month high earlier in the week. China’s main index fell 0.94 per cent. South Korea’s Kospi was flat, while the smaller Kosdaq index rose 0.20 per cent after the central bank’s decision.
Australia’s S&P/ASX 200 was among the biggest losers, falling 0.7 per cent. In Asia, S&P 500 futures edged up 0.32 per cent and Nasdaq futures climbed 0.61 per cent.
In commodities, gold dipped 0.30 per cent to $2,371.06 per ounce, retreating from its record high of $2,449.89 set on Monday, as the likelihood of prolonged high US interest rates dampened its appeal.
Oil prices also fell, with Brent crude down 0.70 per cent to $81.34 a barrel and US crude decreasing 0.8 per cent to $76.96 a barrel.