(Bloomberg) -- Global equities edged higher ahead of a key earnings release from Nvidia Corp., the $3 trillion stock at the forefront of the global artificial-intelligence frenzy.
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Seen as a barometer for AI spending across much of the technology industry, Nvidia is expected to project revenue growth of more than 70% for the current quarter when it reports after market close on Wednesday. Any disappointment is certain to roil markets, given the company’s heft in US indexes.
The stock inched higher in premarket trading, having rallied about 160% this year, far outpacing the Nasdaq 100’s 16.4% gain. The options market is implying swings of nearly 10% in either direction on the day after the results.
“The Nvidia result has become very much like a macro event, in some ways as big as the payrolls and CPI releases in terms of market impact,” said Justin Onuekwusi, chief investment officer at wealth manager St James Place. “There’s a lot of money, a lot of leverage in these consensus names and it will take only a slight disappointment to cause significant volatility in markets.”
Futures on the Nasdaq and the S&P 500 traded about 0.1% higher, while Europe’s Stoxx 600 rose 0.5%.
The Nvidia report and earnings guidance are seen as crucial at a time when markets are grappling with the possibility of a US recession and whether the Federal Reserve can cut interest rates fast enough to engineer a soft landing. Money markets currently price about 100 basis points worth of interest rate cuts this year, starting September.
While the dollar rose about 0.2% against a basket of currencies on Wednesday, it’s still on track for its steepest monthly decline this year, undermined by rate-cut bets. Most other currencies lost ground, with the euro dropping 0.5%. US Treasury yields were little changed.
Among individual stock movers, Nordstrom Inc. rose 8.3% in US premarket trading after the department-store chain issued a stronger-than-expected adjusted earnings-per-share outlook. Super Micro Computer Inc. shares were set to extend Tuesday’s losses after Hindenburg Research said it’s short the maker of server equipment.
In Europe, GSK Plc gained after the Delaware Supreme Court decided to review a lower state court decision related to litigation over the firm’s Zantac heartburn medication.
Bitcoin fell below the $60,000 level as part of a broad crypto market retreat that included a sharp drop in second-largest token Ether. In commodity markets, gold retreated after a three-day advance that took it closer to its all-time high, while Brent crude futures shed 1%, adding to the previous day’s slide.
Key events this week:
Nvidia earnings, Wednesday
Fed’s Raphael Bostic and Christopher Waller speak, Wednesday
Eurozone consumer confidence, Thursday
US GDP, initial jobless claims, Thursday
Fed’s Raphael Bostic speaks, Thursday
Japan unemployment, Tokyo CPI, industrial production, retail sales, Friday
Eurozone CPI, unemployment, Friday
US personal income, spending, PCE; consumer sentiment, Friday
Some of the main moves in markets:
Stocks
The Stoxx Europe 600 rose 0.5% as of 11:14 a.m. London time
S&P 500 futures were little changed
Nasdaq 100 futures were little changed
Futures on the Dow Jones Industrial Average were little changed
The MSCI Asia Pacific Index rose 0.2%
The MSCI Emerging Markets Index was little changed
Currencies
The Bloomberg Dollar Spot Index rose 0.2%
The euro fell 0.5% to $1.1130
The Japanese yen fell 0.3% to 144.41 per dollar
The offshore yuan fell 0.1% to 7.1297 per dollar
The British pound fell 0.3% to $1.3220
Cryptocurrencies
Bitcoin fell 3% to $59,999.01
Ether fell 2.2% to $2,525.91
Bonds
The yield on 10-year Treasuries was little changed at 3.82%
Germany’s 10-year yield declined four basis points to 2.25%
Britain’s 10-year yield declined two basis points to 3.98%
Commodities
Brent crude fell 1.1% to $78.70 a barrel
Spot gold fell 0.7% to $2,507.17 an ounce
This story was produced with the assistance of Bloomberg Automation.
--With assistance from Michael Hennessey.
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