Nvidia fuels worldwide stock frenzy, bond yields rise
By Herbert Lash and Marc Jones
NEW YORK/LONDON (Reuters) -Nvidia's stunning AI-related results sparked a worldwide wave of record highs in equity markets on Thursday, including the first new peak for Japan's Nikkei since 1989, while bond yields mostly rose as economic data kept immediate hopes of interest rate cuts at bay.
The benchmark S&P 500 index and Dow Jones Industrial Average on Wall Street, along with Europe's pan-regional STOXX 600 index, also hit fresh record highs as Nvidia (NASDAQ:NVDA)'s shares surged 15.4% and lifted artificial intelligence-related chip stocks around the world.
National bourses in Frankfurt and Paris also set fresh highs, while Chinese stocks overnight extended their winning streak to eight straight sessions.
Nvidia on Wednesday forecast a roughly three-fold jump in first-quarter revenue and beat expectations for fourth-quarter revenue on strong demand for its AI chips. Nvdia added $250 billion in stock market value, on track for the biggest one-day gain in a company's market capitalization in history.
Artificial intelligence provides the means to boost productivity that economies have struggled to increase for two decades, said Thomas Hayes, chairman and managing member of Great Hill Capital LLC in New York.
«What Nvidia represents is the catalyst for the roaring '20s in terms of productivity enhancement moving forward and as productivity increases, it keeps a lid on inflation,» he said.
MSCI's gauge of stocks across the globe rallied 1.68%, while the pan-European STOXX 600 index closed up 0.82%.
On Wall Street, the Dow Jones Industrial Average rose 1.1%, the S&P 500 advanced 2.09% and the Nasdaq Composite climbed 2.96%, its biggest single-day gain in 12 months.
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