Asian stocks rise as Nvidia earnings forecast beats estimates, South Korea’s Kospi gains

[SINGAPORE] Stocks rose at the start of the Asia-Pacific trading session on Thursday (Aug 27) as Nvidia’s latest earnings report beat estimates, lifting tech hardware manufacturers and reviving investor confidence.

This came after data overnight showed that the US Federal Reserve’s preferred US inflation measure is still running hot.

MSCI’s broadest index of Asia-Pacific shares excluding Japan was up 0.7 per cent, on track to extend gains into a third consecutive day after Nvidia reported that its quarterly revenue more than doubled and forecast third-quarter revenue above Wall Street estimates.

The artificial intelligence chipmaker’s shares jumped 4.7 per cent in after-hours trading, lifting S&P 500 e-mini futures by 0.4 per cent.

“The business is in absolutely rude health,” said Chris Weston, head of research at Pepperstone Group in Melbourne.

“It’s going to wake people up and think ‘what have I missed?’ It’s a really bullish story and anyone supplying Nvidia through the supply chain will likely see the benefit today.”

South Korea’s Kospi rose 1.5 per cent, paring early gains after the Bank of Korea raised interest rates by 25 basis points to 3 per cent, in line with market views that narrowly expected a hike.

Taiwanese shares rose 0.9 per cent, while the Nikkei 225 slid 0.4 per cent.

Stocks on Wall Street edged up overnight with the S&P 500 closing flat after the personal consumption expenditures (PCE) index rose 0.2 per cent in July compared with the prior month after a 0.1 per cent decline a month earlier.

SEE ALSO

European shares muted as investors assess Iran-Oman talks, US inflation

US stocks: Wall Street stocks end tad lower after hot inflation data ahead of Nvidia earnings

“July core PCE inflation appeared broadly in line with expectations, but the details were firmer,” analysts from Societe Generale wrote. “The inflation backdrop therefore looks somewhat firmer heading into the September Federal Open Market Committee meeting.”

The yield on the US 10-year Treasury bond was down 1.5 basis points at 4.647 per cent as markets awaited Fed chair Kevin Warsh’s speech in Jackson Hole, Wyoming, on Friday, for further clues on the path for US interest rates.

Brent crude was down 0.7 per cent at US$87.20, with the benchmark on track to fall for a fourth consecutive day as Qatar’s prime minister prepares to visit Teheran on Thursday in an effort to relaunch peace talks between the US and Iran.

“Crude oil prices continued to gradually ease despite a still highly uncertain outlook around management of the Strait of Hormuz and the current health of global oil supply, especially in light of renewed threats of escalation from Putin in the Russia-Ukraine war,” Westpac analysts wrote.

The US dollar index, which measures the greenback’s strength against a basket of six currencies, held at 99.12, near its highest level over the past week.

Gold rallied 0.7 per cent to US$4,624.14 after a pullback on Wednesday. In cryptocurrency markets, bitcoin was up 0.8 per cent at US$79,043.18, while ether was up 1.3 per cent at US$2,504.96.

All three are benefiting from the revival of so-called “dollar debasement trades” after the US Treasury Department intervened in bond markets last week. REUTERS