Nvidia earnings spark global market rally

AFP | London

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Stock markets rallied yesterday after bumper earnings from chip titan Nvidia eased fears of an AI bubble and overshadowed a mixed US jobs report.

All three major Wall Street indices jumped at the open, following gains in Europe and Asia. Investors cheered an earnings report from AI bellwether Nvidia, released after US markets closed Wednesday, which topped expectations on fierce demand for its advanced chips.

Chief executive Jensen Huang also brushed off fears of an artificial intelligence bubble that had recently caused global equities to wobble.

“Nvidia’s results have completely changed the market mood and pushed out any bubble fears for another day,” said Jim Reid, managing director at Deutsche Bank.

Shares in the chipmaker -- which last month became the world’s first $5 trillion stock -- rose around four percent yesterday.

The upbeat report overshadowed a delayed US September jobs report, which showed that hiring exceeded analyst expectations while the jobless rate crept up.

Due to the record-long government shutdown, yesterday’s figures were the last official major labour market data released ahead of the Federal Reserve’s meeting in December.

Minutes from the Fed’s October policy meeting, released Wednesday, suggested officials are against cutting rates for the third time in a row next month.

“For as much focus as this jobs report garnered ... it’s being overshadowed by Nvidia’s blowout earnings results,” said eToro  US investment analyst Bret Kenwell.

London, Paris and Frankfurt all advanced yesterday after a largely positive session in Asia, which saw Japan surge nearly three percent.

Tech stocks led the gains in Asia. South Korea’s Samsung and SK hynix, Taiwan’s TSMC and Japanese investment giant SoftBank all enjoyed a strong day.

In company news, shares in US retail giant Walmart rose around four percent after it reported higher quarterly revenue and raised its outlook.