Nvidia Tumble Brings Down the Nasdaq, Tariffs Rattle Markets

The Nasdaq tumbled 2.8% on Thursday, its worst one-day drop in a month as Nvidia fell 8.5% after posting earnings. Trump’s renewed tariff threats have rattled global markets. European stocks slid, the euro hit two-week lows, and the Canadian dollar slumped to a 3.5-week low, while Asian markets fell sharply, led by a nearly 3% drop in Japan’s Nikkei. Investors await the US PCE deflator report today.

Equities

The FTSE 100 rose 0.3% on Thursday, reaching a one-week high, as strong earnings and positive forecasts lifted key stocks. Rolls-Royce surged 16% to an all-time high after raising its mid-term targets, boosting the FTSE 350 aerospace and defence index by 9.1%. The London Stock Exchange Group climbed 6.1% following a forecast of continued growth and improved profitability in 2025. Aviva gained 4.2% after posting full-year profits ahead of expectations, driven by double-digit growth in general insurance premiums.

WPP slumped 16% after warning that revenue and profit could remain flat this year due to weakness in China and uncertainty in the US. The FTSE 250 dropped 0.9% to a one-month closing low, weighed down by Ocado, which fell 18% amid concerns over slow expansion of its robotic warehouse sites.

The S&P 500 dropped 1.59%, while the Nasdaq fell 2.78%, its biggest one-day loss in a month. Nvidia tumbled 8.5%, erasing $274 billion in market value, after issuing a weaker-than-expected gross margin forecast, despite an optimistic revenue outlook. Other chipmakers followed, with Broadcom down 7% and AMD losing 5%, pulling the Philadelphia semiconductor index down 6.1%. Concerns over AI sector growth intensified following reports that Microsoft may be reducing data centre leases.

Salesforce declined 4% after forecasting fiscal 2026 revenue below expectations, while Snowflake rose 4.5% on a stronger-than-expected product revenue outlook. Warner Bros Discovery gained 4.8% after projecting a doubling of streaming profits this year. Meanwhile, Viatris slumped 15% after issuing a weak annual forecast.

The Dow Jones slipped 0.45%, with broader concerns over slowing US economic growth. Weekly jobless claims rose more than expected, and data indicated that the economy slowed in the fourth quarter. The Cboe Volatility Index, a key measure of market sentiment, closed at its highest level since December.

Energy stocks outperformed, with the S&P 500 energy index up 0.5%, as oil prices climbed after President Trump revoked Chevron’s license to operate in Venezuela. Trade concerns remained in focus after Trump reiterated that 25% tariffs on Mexican and Canadian goods will take effect next week and suggested similar tariffs on European cars and other goods.

Forex & Commodities

The US dollar strengthened on Thursday, posting its biggest daily gain in over two months. The dollar index rose 0.72% to 107.23, while the euro fell 0.74% to $1.0405. The Canadian dollar weakened 0.69% to C$1.44 after Donald Trump confirmed that 25% tariffs on Canadian and Mexican imports will take effect next week. The Mexican peso also slipped 0.12%. Against the Japanese yen, the dollar gained 0.52% to 149.85, while sterling fell 0.51% to $1.2608.

Gold declined 0.5% to $2,862.05 an ounce, heading for its biggest weekly drop since November as a stronger dollar weighed on demand. Prices are still up 2.2% for February after eight consecutive weeks of gains. Silver dropped 0.4% to $31.12, while platinum and palladium also fell. Investors are awaiting the US PCE inflation data later today for further signals on the Federal Reserve’s next move.

Oil prices edged lower, with Brent crude down 0.4% to $73.26 a barrel and WTI crude falling 0.4% to $70.04. Prices are on track for their first monthly decline since November as concerns over US economic growth and new tariff policies weigh on sentiment. However, supply concerns have resurfaced after Trump revoked Chevron’s license to operate in Venezuela, which could lead to new agreements on crude exports.