- Nvidia’s stock soared by 7.1%, marking its most significant one-day rise since May 25.
- Nvidia is riding the wave of optimism surrounding artificial intelligence.
- European equities bounced back on Monday, rallying from a nearly one-week low.
The equity indexes ended higher on Monday, driven by chipmaker Nvidia’s remarkable surge. This surge was sparked by Morgan Stanley’s positive note and a boost seen in other major growth stocks.
Nvidia’s stock soared by 7.1%, marking its most significant one-day rise since May 25. This surge was comparable to the 24% increase in May, fueled by an impressive revenue forecast highlighting artificial intelligence’s potential.
The chipmaker’s rally propelled the tech index by 1.85%, making it the strongest among the S&P 500’s eleven sector indexes. Other leading growth stocks also saw gains. Alphabet climbed 1.4%, and Amazon.com went up by 1.6%.
Like several other tech companies this year, Nvidia is riding the wave of optimism surrounding artificial intelligence. The company is set to announce its quarterly results in the upcoming week.
This week, market attention will be directed toward the quarterly earnings reports of significant US retailers like Walmart and Target. Additionally, economic data for July, particularly retail sales, will shape expectations regarding US interest rates.
Traders are estimating an almost 89% likelihood that the Federal Reserve will maintain its current interest rates next month, according to CME Group’s Fedwatch tool. In its recent report, Goldman Sachs forecasted that the Fed will begin reducing the funds rate in Q2 of 2024.
Despite these developments, concerns over China’s heavily indebted property sector persist, dampening global market sentiment. Investor apprehensions grew after Country Garden, China’s top private property developer, sought to postpone payment on a private onshore bond, marking its first such delay.
Meanwhile, European equities bounced back on Monday, rallying from a nearly one-week low. Retail and healthcare sectors led the gains, overshadowing the declines in miners and energy companies, adversely affected by concerns surrounding China’s struggling property industry.
The retail sector index emerged as the top performer, climbing by 0.8%. B&M European Retail stole the spotlight by rising 3%, a surge triggered by Deutsche Bank’s upward revision of its price target.
Oil declines (Source: Nymex, ICE)
Meanwhile, the mining and energy sectors faced significant setbacks due to declining prices of crude oil and base metals. These declines were attributed to a bleak demand outlook in China, a top consumer, exacerbated by the property sector’s debt issues.