The Overnight Report: Ex-Nvidia Shares Are Up

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Good morning.

The best way to describe overnight price action in the US is Nvidia down, most of the rest is up. This is what can happen when some stocks represent a big weight in the index.

Compare it to BHP Group locally, with its share price moves sometimes holding up the index when everything else is under pressure, or weighing down the index on an otherwise sunny session.

Nvidia released better-than-forecast quarterly numbers, would you believe it? But there’s so much attention (and resentment from those not on board) for a company that has become the posterboy of Ai and the technology sector at large, that only a perfect scorecard would have been sufficient, or so it seems.

Plenty of expert voices that are assuring investors should grab the opportunity and get on board, if they’re not already. Nvidia shares lost some -6.4% overnight, for a gain still in excess of 137% year-to-date.

Five of the so-called Magnificent Seven closed higher, including Apple shares gaining 1.5% after Citigroup named the iPhone maker its top AI pick. CrowdStrike shares jumped 2.8% after the cybersecurity company beat quarterly revenue estimates. Best Buy shares soared 14.1% after management raised the earnings outlook.

Shares in Dollar General, on the other hand, fell by -32.2% on a profit warning. The Dow Jones index rose by 244 points or 0.6% to reach a fresh all-time record high, the S&P500 index ended flat and the Nasdaq index retreated by -40 points or -0.2%.

Over in Europe, technology stocks outperformed pushing the continent-wide FTSEurofirst 300 index up 0.8%. In London, the UK FTSE100 index rose 0.4%. German inflation fell quicker-than-anticipated. That country’s CPI reading fell to 2%, the lowest number in over three years.

US government bond yields rose on Thursday, after economic data indicated the US economy remains on solid footing with most data beating economists’ estimates.

As it turned out, the US economy (GDP) expanded at a 3% annualised pace in the June quarter. Initial jobless claims fell by -2,000 to 231,000 last week. Pending home sales fell -5.5% in July. Wholesale inventories lifted 0.3% in July. The goods trade deficit widened by -US$6.1bn to -US$102.7bn in July.

ANZ Bank reports the stronger USD triggered by the better-than-expected economic data weighed on investor appetite across the base metals sector. Aluminium led the metals lower as concerns about the strength of China’s demand recovery lingered. Ample supply added to the gloom.

Rusal shipped record volumes of aluminium to China in the first half of the year. This has seen inventories in China rise to their highest levels for this time of year since 2019.

Gold held gains as traders await key inflation data that may shed light on the path of the US Federal Reserve’s interest rate policy.

Iron ore traders shrugged off concerns over weaker demand to push prices back above USD100/t. Crude oil prices rallied as robust US economic data eased concerns about weaker demand.

SPI futures are indicating a positive start for the ASX this morning. Today also marks the official finish line for the August results season, though the FNArena Monitor will continue on the other side of the weekend as analysts still respond to today’s releases, with further catch-up from the tsunami.

On the calendar today:

-Australia July Private Sector Credit
-Australia July retail sales
-Japan Aug CPI
-Eurozone Aug CPI
-US July PCE
-Aeris Resources ((AIS)) earnings report
-Ampol ((ALD)) ex-div 60c (100%)
-APM Human Services International ((APM)) earnings report
-Dicker Data ((DDR)) earnings report
-Harvey Norman ((HVN)) earnings report
-Nickel Industries ((NIC)) earnings report
-Boss Energy ((BOE)) earnings report
-Big River Industries ((BRI)) ex-div 2c (100%)
-Ramsay Health Care ((RHC)) earnings report
-TPG Telecom ((TPG)) earnings report

FNArena’s Corporate Results Monitor: https://fnarena.com/index.php/reporting_season/

Corporate news in Australia:

-Genesis Minerals ((GMD)) is reportedly a potential buyer for Magnetic Resources ((MAU))

-Southern Cross Media ((SXL)) is restarting the sale of its regional TV assets and is negotiating with buyers

-Fortescue ((FMG)) invests -$22m in HyTerra to enter the white hydrogen sector

The Australian share market over the past thirty days

For more detail go to FNArena’s Australian Broker Call Report, which is updated each morning, Mon-Fri.

All overnight and intraday prices, average prices, currency conversions and charts for stock indices, currencies, commodities, bonds, VIX and more available on the FNArena website.  Click here. (Subscribers can access prices on the website.)

(Readers should note that all commentary, observations, names and calculations are provided for informative and educational purposes only. Investors should always consult with their licensed investment advisor first, before making any decisions. All views expressed are the author’s and not by association FNArena’s – see disclaimer on the website)

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