Nvidia (NVDA)
Nvidia is due to report earnings on Wednesday, which are set to beat previous results. The chipmaker is expected to report quarterly adjusted earnings per share (EPS) of $0.65 on revenue of $28.7bn (£21.7bn). This would represent a 139% increase in EPS and a 113% increase in revenue compared to the same period last year, when Nvidia posted EPS of $0.27 on revenue of $13.5bn.
Nvidia is the global leader in AI chip design and software, controlling 80% to 95% of the market, and is expected to maintain its lead as it begins rolling out the next generation of its Blackwell chip line, according to Reuters.
The most anticipated results this quarter will have ripple effects across the tech industry, as investors look for signs that AI deals will continue to dominate market conversations in the second half of the year.
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Nvidia shares are up more than 163% year to date and up 60% over the past six months. Shares of rival AMD (AMD) are up 9% year to date and down about 14% over the past six months.
Nigel Green of deVere Group said: “We have become the undisputed leader in artificial intelligence (AI) chips, a market segment that is transforming industries around the world. In a world increasingly dominated by AI-driven technologies, Nvidia is well ahead of its competitors.”
“The company's cutting-edge GPUs, particularly its Hopper architecture, are generating huge demand and there is no clear competitor that can match their performance.”
“The result? Nvidia's stock price and market capitalization soared, far outpacing the overall market.”
Mining giant BHP plans to increase copper production after its main iron ore business was hit by China's economic slowdown.
FTSE 100 (^FTSE) Group said it expects Chinese demand for steel to remain weak into 2024.
Iron ore consumption has been hit by an economic slowdown as a drop in building construction in China shaves off demand for the metal for steel. Nearly two-thirds of BHP's profits come from iron ore and just under a third from copper.
BHP chief executive Mike Henry said: “In the near term, we expect an uneven recovery in end-use sectors in China and volatility in global commodity markets. The effectiveness of recently announced pro-growth policies will be a key factor in China achieving its official 5% growth target.”
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The story continues
BHP's profits for the year to June rose 3 percent to $55.7 billion, while underlying net profit rose 2 percent to $13.7 billion.
But total profit attributable to shareholders fell 39 percent after it wrote down the value of its Australian nickel operations by $2.7 billion and recorded a $3.8 billion charge related to the collapse of a dam in Brazil.
The company also cut its full-year dividend 14 percent to $1.46, reflecting increased investment in new projects.
At the time of writing, the stock was up 1.5%.
Ryanair shares rose more than 6% on Tuesday after CEO Michael O'Leary said fare cuts would be capped at 5%, reassuring investors who were worried about bigger price cuts.
Last month, Europe's largest airline warned that fares could fall by more than 10% after revenue fell short of analysts' expectations, sending the airline's shares plummeting 15% in the last month.
The risk of a double-digit drop in average fares, which O'Leary called an “ugly scenario” at the time, “appears to have disappeared.”
“Freight rates were down a bit in April, May and June, but they have now stabilized,” he said.
Asked whether Ryanair was still seeing price resistance when it tried to increase fares last minute, O'Leary said: “It's not the same price resistance.”
Brent Crude Oil (BZ=F)
Brent crude oil prices remained flat on Tuesday, stabilizing after three consecutive trading days of gains that saw prices rise by around 7%.
Crude oil futures rose 7% in their sharpest three-day rally since April last year to trade at about $81 a barrel, while West Texas Intermediate (WTI) was hovering around $77.
“The rally was fuelled by expectations of a cut in US interest rates, which dominated the market after the Federal Reserve chairman hinted at easing off the brakes on monetary policy,” said Ricardo Evangelista, senior analyst at ActiveTrade.
“Jerome Powell hinted at a rate cut in September and left the door open for further cuts by the end of the year, which should strengthen the outlook for economic growth and, ultimately, oil demand.”
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“Meanwhile, in the Middle East, tensions are rising between Israel, Iran and their proxies, raising the threat of all-out war and potentially causing serious disruptions to global oil supplies.”
“Adding to supply concerns, a possible shutdown of Libyan oil fields could remove more than 1 million barrels per day from an already strained market.”
“Against this backdrop, pressures are building from both the supply and demand sides and there may be scope for further increases in oil prices.”
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