Shares halt before hitting record highs as Nvidia earnings rise Reuters

By Tom Westbrook

SINGAPORE (Reuters) – Global shares were close to record highs on Wednesday, with the next move based on results from chipmaker darling Nvidia (NASDAQ: ) while sterling hit a 2½-year high , as traders bet the UK would lag behind. US in cutting interest rates.

MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.4 percent. decreased by 0.2%.

Oil rebounded from a recent peak in Middle East tensions as bleak Chinese demand returned to the fore and futures traded just below $80 a barrel. (OR)

Nvidia’s market value has risen due to its dominance of the computing hardware behind artificial intelligence. Its stock price is up about 3000% since 2019, and with a market cap of $3.2 trillion, a move in its stock affects the entire market.

Second-quarter revenue is likely to have doubled, though even that could disappoint expectations. Options prices show traders are anticipating a nearly 10 percent — or $300 billion — change in market value, possibly the biggest earnings move by any company ever.

The results at “the so-called ‘world’s most important company'” are between Wall Street and new records, noted Capital.com analyst Kyle Rodda, and set the tone for the sector.

“The company’s revenue and sales guidance is a barometer of AI equity, with inferences to be made about the health of other megacap tech names,” he said.

Stocks rose about 0.2 percent overnight and futures fell 0.1 percent in Asia, while futures fell 0.3 percent.

E-commerce shares steadied in Hong Kong – where they fell 0.5 percent – after taking a hit on downbeat remarks from online discount retailer PDD Holdings earlier in the week.

China’s biggest sportswear maker Anta was the biggest gainer, with shares up 8.5 percent after better-than-expected profits and a $1.3 billion buyback. Shares in Australian gaming company Tabcorp fell 12 percent and were headed for their biggest drop in 2020 after the company slashed asset prices and said rising costs meant it would miss earnings targets.

Debt and currency markets were flat in the Asian session, although the Australian dollar rose about 0.2% to hit a January high of $0.6813 after monthly inflation data was slightly higher than market expectations.

Globally, a weakening dollar in anticipation of U.S. interest rate cuts lifted most other currencies as markets see U.S. short-term rates, currently above 5.25 percent, as the most likely to fall. The yen traded at 144.32 per dollar.

interest rate futures price 100 basis points of US interest rate cuts this year and last week Fed Chairman Jerome Powell hinted at an imminent start to cuts, saying “the time has come”. The tone contrasts with caution at the Bank of England, which has helped sterling become the best-performing G10 currency with a 4.1% gain for the year to date.

It hit a two-year high overnight at $1.3269 and came close to that level on Wednesday. (GBP/)

“Inflation in the UK services sector … is still uncomfortably high,” Rabobank chief strategist Jane Foley said in a note.

“In our view, the BoE is likely to cut rates only once a quarter,” she said, against a forecast for four consecutive 25bp cuts from the Fed from September to January.

Rate markets were steady, with 10-year US Treasury yields at 3.83%, two-year yields at 3.87% and the gap between the two narrowest in nearly three weeks.

Heavy evening selling in New York sent bitcoin down 4% against the dollar to $59,350. Gold held at $2,517 an ounce.