© Reuters
Investing.com – Nvidia shares are rising after a blockbuster earnings release that further fueled market euphoria surrounding artificial intelligence applications. The rally is pushing the index and the Dow Jones to new record closing highs, although futures on Friday point to a more subdued end to the trading week. Elsewhere, Reddit is filing for an IPO.
1. Nvidia increases its stock market value by $277 billion
Artificial intelligence chip developer Nvidia (NASDAQ:) increased its market capitalization by a staggering $277 billion on Thursday, setting a record for the largest single-day jump in history.
Shares of the California-based company rose 16.4% to end the session at a new record high of $785.38, pushing its market value to nearly $2 trillion. The one-day rise in Nvidia shares was itself larger than the market cap of competitor Advanced Micro Devices (NASDAQ:) and surpassed a $196 billion gain posted by Facebook owner Meta Platforms (NASDAQ:) earlier this month.
In total, $65 billion worth of Nvidia shares were traded, accounting for about a fifth of all S&P 500 stocks traded, Reuters reported.
Key to the excitement was a 265 percent increase in revenue at Nvidia in the fourth quarter, as well as comments from CEO Jensen Huang, who said demand for AI is “surging globally across all companies, industries and countries.”
2. The future is muted
U.S. stock futures hovered around the flat line on Friday, signaling a breather in the rally sparked by Nvidia's record results.
At 3:00 a.m. ET (08:00 GMT), the contract was, and largely unchanged.
Major Wall Street averages – as well as indexes in Asia and Europe – rose on Thursday after Nvidia reported a massive rise in sales and offered an upbeat outlook for demand for AI chips.
In New York, the blue chip rose 1.2% and the benchmark S&P 500 gained 2.1%, both ending at record closing highs. The tech-heavy index, meanwhile, rose 3.0% – its biggest single-session gain in a year and slightly below its all-time high closing level.
3. Reddit Files for IPO
Reddit reported a narrower loss when it filed its initial public offering documents with the Securities and Exchange Commission on Thursday, ahead of the company's highly anticipated debut on the New York Stock Exchange later this year.
The company, which was founded in 2005 with the idea of creating “the homepage of the Internet,” plans to trade on the New York Stock Exchange under the ticker symbol “RDDT.” According to recent media reports, Reddit is aiming to go public in March.
In the filing, Reddit said the amount of shares sold on the platform to retail investors and users would be “significant,” but noted that the participation could result in “increased volatility” in the market price. Typically, IPOs are mostly purchased by institutional investors.
For the year ended December 31, 2023, the social media company reported a loss of $1.54 per share, compared to a loss of $2.77 per share a year earlier, as revenue was driven primarily by advertising sales driven, rose from $666 million to $804 million a year earlier.
4. StanChart reports a 22% annual jump in income
Asia-focused lender Standard Chartered (HK:) (LON:) posted a higher profit for 2023 as it benefited from higher interest rates and the bank also announced a $1 billion buyback.
Still, the lender cut its 2024 earnings outlook and forecast a slight increase in its net interest income, citing some economic risks from persistent inflation and potential geopolitical instability.
StanChart's underlying profit before tax for the year to December 31 rose 22% to $5.68 billion, the group said in a statement to the Hong Kong Stock Exchange. Underlying net interest income rose 20% for the year to $9.56 billion.
5. Oil prices are falling
Oil prices were lower in European trading on Friday and are expected to end the week slightly lower as concerns about sluggish demand largely canceled out bets on tighter supplies due to disruptions in the Middle East.
A string of weak economic data from around the world sparked further concerns about slowing demand, particularly after data released last week showed both Britain and Japan falling into recession in the fourth quarter.
Expectations of longer-term higher U.S. interest rates also weighed on the outlook for demand at the world's largest oil consumer, as several signals from the Federal Reserve showed the bank was in no hurry to start cutting rates.
April crude contracts fell 0.5% to $83.24 a barrel, while West Texas Intermediate crude futures fell 0.6% to $77.50 a barrel at 3:01 a.m. ET.
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