The market was under scrutiny ahead of Nvidia’s numbers

A look at the day ahead in European and global markets from Tom Westbrook

Nvidia is keeping the investment world under wraps ahead of an earnings report later today that, while it will deliver an expected doubling of second-quarter revenue, may not satisfy investors accustomed to market-moving performance.

The chipmaker’s market value was about $390 billion on the eve of the launch of its artificial intelligence (AI) chatbot, ChatGPT, less than two years ago.

It’s now worth nearly $3.2 trillion, and in June it felt short-changed as the most valuable company on earth, powered by the chips that provide the hardware behind the AI ​​computing boom.

Its sheer size and position as a major industry watchdog means its gains, due after the US close on Wednesday, can move the entire market.

Asian trade was light and moved modestly ahead of the release, and European stock futures were steady.

Europe’s reporting and data calendar is mostly empty, with eurozone currency growth seen rising to 2.7%, while markets are focused on Nvidia results ahead of European and US measures on inflation that will take place during the week.

Options prices show traders braced for a nearly 10 percent swing in Nvidia shares when they trade on Thursday, turning into dollars at a market value of more than $300 billion — perhaps the biggest market move since ever in an earnings report.

That would shrink the market capitalization of 95% of S&P 500 constituents, according to LSEG data, and likely send shockwaves through the global semiconductor sector.

Elsewhere, sterling neared a 2½-year high on Wednesday, one of the biggest beneficiaries of a slide in the dollar. Traders anticipate about 100 basis points of US interest rate cuts this year, compared to just 40 basis points in the UK.

As the markets wait for Nvidia’s turn to take center stage, fans of Oasis, which signed its first record deal in 1993, just weeks after Nvidia was founded, can join the battle for Mancunian hotel rooms following the announcement of an Oasis reunion planned for the year future.

Key developments that could influence markets on Wednesday:

Earnings: Nvidia

Economy: M3 growth in the euro area, unemployment in France

(By Tom Westbrook; Editing by Edmund Klamann)