Nvidia Faces Supply Constraints Amid Robust AI Demand, Markets React Globally
Market Overview and Key Developments
A look at the day ahead in European and global markets from Gregor Stuart Hunter
Nvidia's Ongoing Supply Challenges
Nvidia CEO Jensen Huang says the company has enough supply for "very, very robust growth" linked to the AI boom. But it still needs more.
Speaking at a conference in Taipei on Tuesday, he told an audience of chipmakers and computer hardware manufacturers that supply constraints remained a concern, a day after the $5 trillion chip company unveiled a new chip that will compete with Advanced Micro Devices and Intel. Nvidia is often considered a barometer for the AI market's health as its chips are used in data centres all over the world.
Global Market Reactions
Asian Markets and Geopolitical Tensions
On another day, Huang's comments might have been good news for the Asian chipmakers that supply the company, but markets remained skittish in Asia as anxieties over whether the U.S.-Iran ceasefire would remain intact weighed on equities. MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.1% and S&P 500 e-mini futures slid 0.4%.
Oil and Regional Conflicts
Oil markets cooled, with Brent crude off 0.7% at $94.30 and retracing some gains after Iran threatened to break off talks with the United States. Lebanon announced a partial ceasefire between Hezbollah and Israel earlier this week, potentially de-escalating the conflict, but the Israeli military said it intercepted two projectiles fired from Lebanon on Tuesday.
Stock Market Movements
Korean shares were especially choppy, falling as much as 3.3% after initially gaining 1.7% to set a new intraday record high, while shares in Hong Kong and China steadied the wider regional benchmark.
In early European trades, pan-region futures were up 0.4%, German DAX futures gained 0.3%, and FTSE futures nudged 0.1% higher.
Legal and Regulatory Updates
Short Seller Verdict
Meanwhile, a U.S. jury found prominent investor Andrew Left guilty of securities fraud on Monday, the Justice Department said, in a blow to a divisive cohort of short sellers who have for years goaded public companies in the U.S. and overseas with allegations of fraud and mismanagement.
Left will be sentenced on August 31.
Key Events to Watch
Company Earnings
Major Announcements
Palo Alto Networks, Dollar General
Economic Events
France
Budget Balance for April
UK
BOE Consumer Credit, Mortgage Lending, Money Supply for April
Debt Auctions
France
3-month, 7-month and 1-year government debt
Germany
4-month, 10-month and 2-year government debt
UK
11-year government debt
(Reporting by Gregor Stuart Hunter; Editing by Kate Mayberry)
