Moving markets: Will FTSE 100 ride the Nvidia ‘FOMO’ wave in AI trade today?

Moving markets today: Asian markets follow wall street surge, Nvidia fuels AI frenzy, oil prices drop, China’s home prices slide; focus on German GDP and StanChart earnings 

S&P 500 reaches all-time high driven by Nvidia’s optimism. Nvidia made headlines by achieving a remarkable one-day market capitalization increase of $277 billion. Meanwhile, China experienced a prolonged decline in new home prices throughout January. U.S. Federal Reserve policymakers emphasized that any consideration of interest rate cuts is premature at this stage. With no significant U.S. economic releases, attention turns to Germany’s GDP data and the earnings report from StanChart. Here are five key takeaways for your day. 

Nvidia’s $277 billion surge sets new market cap record in single day 

Nvidia made history in a single trading session by achieving a record-breaking increase in market capitalization. The chipmaker’s stock price soared by 16.4 percent, resulting in a remarkable boost of $276.7 billion to its overall valuation. This surge in value surpassed the market capitalization of competitors like Advanced Micro Devices and financial giants like Bank of America, falling just shy of Nestle’s valuation by approximately $9 billion. As reported by the Financial Times, this achievement eclipsed the previous record set by Meta earlier in the month, which amounted to $196.8 billion. Nvidia’s extraordinary one-day surge in market value now stands as the largest in the history of Wall Street. 

China’s sees continued decline in new home prices 

In January, China saw its seventh straight month of declining new home prices, despite increased efforts by policymakers to restore confidence in the debt-ridden sector. According to Reuters calculations from National Bureau of Statistics (NBS) data, prices fell by 0.3% from the previous month and were down 0.7% compared to a year earlier. 

Federal Reserve governors advocate caution on interest rate cuts 

According to Federal Reserve Governor Christopher Waller, it might be wise for U.S. policymakers to hold off on reducing interest rates for a few more months. He suggests this delay would allow them to better understand whether the recent increase in inflation signifies a potential slowdown in achieving stable prices or is merely a temporary fluctuation. 

Similarly, Federal Reserve Governor Lisa Cook said that as inflation moderates and the job market stabilizes, the risks facing the economy now appear to be balanced between positive and negative outcomes. However, she emphasized that it’s premature to consider lowering interest rates at this point. 

UK consumer morale takes unforeseen hit in February: GfK 

British consumer sentiment experienced its initial decline in four months in February, reported by Reuters. The survey highlighted that households were less optimistic about their recent financial situations and the broader economic outlook. The GfK consumer confidence index, a longstanding survey in Britain, decreased by 2 points to -21. This figure fell below the expectations of economists surveyed by Reuters, who had predicted a slight improvement to -18. 

Asian markets mirror overnight rally on Wall Street 

The S&P 500 gained 2.11% to 5,087.03 points. The Dow Jones Industrials surged 1.18% to 39,069.11 points, marking its first close above 39,000 points. The Nasdaq Composite added 2.96%, closing at 16,041.62 points. Nvidia shares jumped by 16.4% to $785.38. Other companies, seen as beneficiaries of the AI boost, also experienced significant increases. Nvidia’s rival Advanced Micro Devices, server component supplier Super Micro Computer, and Arm Holdings saw jumps ranging between 4.2% and 32.9%. Major tech and growth stocks like Alphabet, Microsoft, and Meta Platforms climbed between 1.1% and 3.9%. 

Asian stocks also followed the upward trend of Wall Street, with Japan’s market closed for a holiday on Friday. Nikkei futures indicated an uptick of about 300 points. China’s blue-chips CSI300 increased by 0.4% on Friday, marking a weekly gain of 4.0% and rebounding about 10% from five-year lows two weeks earlier. Hong Kong’s Hang Seng index climbed by 0.8%. 

Oil prices fell after earlier climbing due to supply fears amidst ongoing hostilities in the Red Sea and a notable build in U.S. crude inventories. Brent eased by 0.4% to $83.37, while U.S. crude slipped by 0.5% to $78.24 per barrel. The spot gold price remained flat at $2,026.07.