Nasdaq hits record high before Nvidia earnings

Equities

On Monday, the FTSE 100 increased by 0.1% following two consecutive days of declines, buoyed by gains in the precious metal mining sector. The mid-cap FTSE 250 fared better, rising 0.6% to reach its highest point in over two years. The increase in the FTSE 100 was largely supported by a 2.8% rise in the precious metal miners index as spot gold prices hit record highs. Similarly, industrial metal miners saw an advancement of 0.5% following a peak in copper prices.

Among the notable UK companies, Keywords Studios saw an impressive surge of 55.2% after news that European private equity group EQT was in advanced discussions to acquire the video game services company for $2.79 billion. Kainos Group also stood out with a 17.3% increase on the mid-cap index after reporting positive full-year results. Conversely, EasyJet experienced a decline, dropping 3.2% as concerns about slower growth in airfares were highlighted by Ryanair's CEO, citing a recessionary feel around Europe.

Across the Atlantic, the Nasdaq Composite led gains among major US indices, closing up 0.65% and reaching a new record high. This rise was propelled by advances in technology stocks, particularly ahead of Nvidia’s anticipated earnings release. Nvidia itself climbed 2.49%, buoyed by optimistic brokerage upgrades on its price targets. The S&P 500 saw a slight gain of 0.09%, with the technology index increasing by 1.32%, largely due to positive movements in semiconductor stocks like Micron Technology, which rose 2.96% following an upgrade by Morgan Stanley.

In contrast, the Dow Jones Industrial Average fell by 0.49%, primarily dragged down by a 4.5% decrease in JPMorgan shares. The bank’s CEO expressed caution about the economic outlook and announced a halt to stock buybacks at current prices. This sentiment overshadowed the Dow’s recent milestone of closing above 40,000 points for the first time the previous week.

Forex & Commodities

On Monday, the US dollar saw a slight increase against the euro, with the pair trading at $1.0863, a 0.05% drop for the euro. This modest uptick came as market participants awaited further indications regarding the future direction of US interest rates, following cautious remarks from Federal Reserve officials. The dollar also gained against the Japanese yen, rising 0.4% to 156.26 yen.

Sterling showed a marginal increase, trading up 0.07% at $1.2711, after recently reaching a two-month peak of $1.27255. This occurred in anticipation of a key UK inflation report expected on Wednesday.

In commodities, gold rallied before retreating from its record high, dropping 0.6% to $2,410.73 per ounce after peaking at $2,440.49 on Monday. The decline was influenced by a stronger dollar, which made gold more expensive for holders of other currencies. Oil prices saw a decline in early Asian trade on Tuesday, with Brent crude futures dropping 0.53% to $83.27 a barrel, and US West Texas Intermediate crude sliding 0.64% to $79.29 a barrel. The dip in oil prices was attributed to ongoing concerns about higher US interest rates potentially dampening consumer and industrial demand.