A screen tracks Nvidia as a trader works on the floor at the New York Stock Exchange on Oct. 23, 2023.
Brendan McDermid | Reuters
Nvidia stands to break its recent pattern of seeing stock declines despite posting stronger-than-anticipated reports. Still, shares of Nvidia dropped more than 1% in Wednesday’s session as investors awaited the release, marking the megacap technology stock’s eighth down day of the last nine.
“We retain our conviction in the broader AI growth story and believe it remains a key driver of our positive market outlook,” a team at UBS led by Global Wealth Management Chief Investment Officer Mark Haefele said in a Thursday morning note.
“While ongoing concerns over the sustainability of AI capex and the circularity of certain AI financing deals may continue to inject periodic tech volatility, the second-quarter earnings season has shown that the fundamentals remain robust,” they added.
More broadly, shares linked to the semiconductor sector rallied in pre-market trading, with Marvell Technology adding more than 5% while Micron and Arm up more than 4%.
Salesforce rallied 11.8% in pre-market trading after revenue came in ahead of Wall Street’s forecast for the second quarter. Okta soared more than 19% ahead of Thursday’s regular session after surpassing analyst expectations and reporting booming demand due to agentic AI.
The three major indexes finished Wednesday’s session little changed. In addition to the raft of earnings, traders are readying for the start of the Federal Reserve’s annual symposium in Jackson Hole, Wyoming, kicking off Thursday.
Investors will also monitor Best Buy earnings due before the bell Thursday, followed by reports expected from Workday, Affirm and Gap after the market closes.
In Asia, Japan’s Nikkei 225 closed 0.20% lower, while South Korea’s Kospi rose 1.53%. Australia’s benchmark S&P/ASX 200 fell 0.98%. Mainland China’s CSI 300 closed 0.86% higher.
European shares were broadly lower Thursday morning, with tech stocks bucking the trend to add 1.5% as regional semiconductor shares jumped following Nvidia’s earnings.