Stocks ease past Nvidia blues, crude oil rebounds

US dollar gains after GDP data backs smaller Fed cut

By Reuters

Top Stories

UAE announces 2-month grace period for residence visa violators

UAE announces fee refund for tax service charges from August 1

Paid parking in Dubai: Residents face up to Dh4,000 extra yearly costs when new rates kick in

A trader works on the floor at the New York Stock Exchange. — Reuters

Published: Thu 29 Aug 2024, 8:02 PM

Global shares edged higher on Thursday, shrugging off investor disappointment at artificial intelligence powerhouse Nvidia's results, while oil prices rebounded from two sessions of losses helped by Libyan supply disruptions.

Wall Street's main indexes were trading higher, with the Dow Jones Industrial Average rose 0.64% to 41,353.44, the S&P 500 gained 0.72% to 5,632.22 and the Nasdaq Composite gained 1.07% to 17,744.52.

European stocks rose 0.75% after hitting a record high powered by technology shares. MSCI's gauge of stocks across the globe rose 0.28% to 829.66.

Nvidia beat analyst estimates on Wednesday with second quarter revenue of $30 billion and third quarter revenue forecast at $32.5 billion. But the results failed to meet lofty investor expectations that have underpinned a massive rally in Nvidia shares and catapulted the company into one of the main drivers of the benchmark S&P 500. The stock was last down 3.3%.

"Interestingly, Nvidia did as well as anybody expected. They did even better, I would say they even crushed the numbers," said Mark Malek, chief investment officer at SiebertNXT in New York.

"But expectations are everything out there these days and people were hoping for some real fireworks."

The U.S. economy grew at a 3.0% annualized rate last quarter, according to Commerce Department data on Thursday, indicating that the Federal Reserve would have room to begin cutting rates in September.

The yield on benchmark U.S. 10-year notes rose 2.6 basis points to 3.867%. Markets are fully pricing in a rate cut of at least 25 basis points (bps) during the Fed's September meeting, although expectations for a cut of 50 bps fell to 34.5% after the data, according to CME's FedWatch Tool.

Investors are also eyeing the personal consumption expenditure price index - which is the Fed's preferred inflation measure - is due on Friday.

"The economy is doing a little bit better than expected. If you break down the number you see once again, it's the intrepid consumer that is continuing to consume, which is very positive for the economy," Malek added.

The U.S. dollar rose after GDP data. The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, gained 0.52% at 101.53, with the euro down 0.53% at $1.1061.

Gold climbed again and was just shy of notching another record high. Spot gold added 0.51% to $2,514.89 an ounce. U.S. gold futures gained 0.63% to $2,518.30 an ounce.

Oil prices edged higher as concerns over Libyan supplies helped offset a smaller than expected draw in U.S. crude inventories, which tempered demand expectations.

Brent crude futures were up 2.15% to $80.34 a barrel, while U.S. West Texas Intermediate crude futures were up 2.15% at $76.39.