Precise Investors Editorial Team
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.7%
Asian stocks rose on Thursday after upbeat earnings from Nvidia soothed concerns over AI-driven disruption and rising costs, while the yen tumbled, bogged down by a murky rate outlook in Japan.
Nvidia on Wednesday forecast first-quarter revenue above market estimates, betting on Big Tech’s unabated spending on its AI processors.
The result, which had been closely watched by investors, quelled some fears about the massive spending companies are pouring into AI.
That helped propel Nikkei to a record high early in the session, while KOSPI was up 2%.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.7%.
Nvidia’s print was strong enough to keep the AI capex cycle alive. The immediate market reaction is relief, translating into a modest risk-on tone after the AI-driven volatility of recent weeks, said Saxo’s chief investment strategist Charu Chanana.
Traders have on the edge regarding the AI trade in recent weeks, worried about returns on investment and the technology’s potential to upend entire industries, yet hesitant to sit on the sidelines.
The debate has been much less about stellar near-term results and more about the sustainability of AI capex spending given concerns around its quantum, monetisation and cashflow degradation, said Richard Clode, portfolio manager at Janus Henderson Investors.
Shares of Nvidia initially climbed in extended trading after the results though later erased those gains, leaving Nasdaq futures down 0.25% and S&P 500 futures 0.14% lower.
EUROSTOXX 50 futures were up a marginal 0.06%.
Lingering worries about escalating tensions between the U.S. and Iran meanwhile kept oil prices higher, ahead of a third round of talks between the two countries later on Thursday.
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