Daily summary: Nvidia earnings drive S&P 500 and Nasdaq rally

6:56 PM May 25, 2023
  • Wall Street indices traded mixed today - Dow Jones and Russell 2000 traded lower while Nasdaq and S&P 500 gained, driven by solid performance of tech shares

  • Nasdaq is trading almost 1.8% higher at press time while S&P 500 gains 0.9%

  • Sentiment towards tech sector improved after Nvidia released earnings yesterday

  • Nvidia stock rallied over 25% today and reached fresh all-time highs after company released solid earnings yesterday after session close and provided an upbeat forecast

  • US House Speaker McCarthy said that negotiators made some progress on debt ceiling yesterday but he is not sure if deal will be reached today

  • Republican negotiator McHenry said that he does not think the deal will be reached today but list of outstanding issues is getting shorter

  • European stock market indices traded mostly lower today. German DAX dropped 0.31%, UK FTSE moved 0.74% lower and French CAC40 declined 0.33%. Dutch AEX was outperformer with 0.14% gain

  • Fed Collins said that a rate pause would give Fed time to measure impact of the already delivered tightening

  • ECB Knot said that there are no signs of underlying inflation abating. Knot also said that ECB needs to hike rates in June and July while staying open minded in September

  • BoE Haskel said that further rate increase in the United Kingdom cannot be ruled out. Money markets currently fully price in 100 basis points of cumulative BoE tightening by the end of 2023

  • German GDP growth for Q1 2023 was revised lower from 0.0% QoQ to -0.3% QoQ. On annual basis growth was -0.2% YoY, compared to +0.2% YoY in flash release

  • Central Bank of the Republic of Turkey left 1-week repo rate unchanged at 8.50% - in-line with market expectations

  • US GDP growth for Q1 2023 was revised higher from 1.1 to 1.3% (QoQ annualized). Core PCE was revised higher as well - from 4.9 to 5.0% QoQ

  • US jobless claims came in at 229k (exp. 245k) with last week's reading being revised lower from 242k to 225k

  • US pending home sales came in flat month-over-month in April while market expected a 1.0% MoM increase

  • EIA report showed a smaller-than-expected build in US natural gas inventories. Inventories increased by 96 billion cubic feet while market expected 100 bcf increase

  • South African rand (ZAR) dropped to a record low against US dollar after SARB delivered 50 bp rate hike but warned that South African economy and currencies is likely to stay under pressure amid global issue

  • USD is the best performing G10 currency, thanks to rising yields amid uncertainty over the debt ceiling

  • Stronger USD is pressuring commodities with oil, natural gas and precious metals trading lower today

S&P 500 futures (US500) bounced off the support zone marked with 23.6% retracement yesterday in the evening as solid earnings from Nvidia lifted sentiment towards stocks. Index climbed above 200-period moving average on H4 interval and is now trying to break through 4,170 pts resistance zone. Source: xStation5


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