Nvidia’s sales and earnings more than doubled in the company’s most recent quarter, showcasing the momentum of the nearly two-year-old AI boom despite concern that investment has surged ahead too quickly. Investors responded by sending the company’s shares down 6.9% in after-hours trading. Through Wednesday’s close, the shares had gained more than 150% this year alone, pushing Nvidia’s valuation above $3 trillion and making it the second-largest listed company in the world, behind Apple. The AI chip giant said Wednesday that sales in the three months through July more than doubled from a year earlier to $30 billion, and it projected around $32.5 billion for its current quarter. Nvidia’s profit more than doubled to $16.6 billion. All those figures topped Wall Street forecasts in a FactSet survey. Nvidia has repeatedly blown through Wall Street forecasts and its own guidance. But its growth rate has begun to ebb in recent quarters, as it butts up against comparisons with last year’s bonanza, and it is becoming harder to significantly outpace outsize expectations each quarter. Still, the company remains atop an AI chip market that presumably will have sales of more than $84 billion this year, up from an estimate of $71 billion as recently as May. Nvidia in June briefly became the most valuable listed company in the world before a summer swoon in which it fell more than a quarter in the midst of concern over the outlook for continued AI spending. It has bounced back almost as sharply since.

The Swiss stock market ended midweek trading with slight gains. The SMI increased by 0.4 per cent to 12,349 points. Of the 20 SMI stocks, there were 13 price gainers and 6 price losers, while Partners Group closed unchanged. A total of 12.08 (previously: 12.17) million shares were traded. Givaudan was the clear winner of the day in the SMI. The share climbed 3.8 per cent. Insurance stocks were also in demand among investors: Swiss Re rose by 1.4 per cent, Swiss Life and Zurich Insurance each picked up 0.9 per cent. UBS (-0.7 per cent), Richemont (-0.9 per cent) and Logitech (-0.4 per cent) were at the back of the pack. The shares of index heavyweight Nestlé rose by 0.8 per cent. Among the two pharmaceutical giants, Novartis shares advanced by 0.7 per cent and reached a new all-time high. The Group achieved positive test results in a phase III trial with the cholesterol-lowering drug Leqvio. The shares of competitor Roche (-0.1%) lagged significantly behind. In the broader market, Stadler Rail fell by 2.5 per cent following its half-year figures. Citigroup spoke of disappointing figures. The company missed expectations in terms of incoming orders, sales, EBIT and free cash flow. EBIT was 26 per cent below the market forecast. The company also burnt considerably more cash than analysts had expected.

Europe
The European stock markets closed higher on Wednesday ahead of the publication of the results of US giant Nvidia, expected after the close of trading on Wall Street. The Stoxx Europe 600 index gained 0.3% to 520.6 points. In Paris, the CAC 40 and the SBF 120 each climbed 0.2%. Frankfurt's DAX 40 added 0.5% and London's FTSE 100 was flat. Air France-KLM (-0.2%) announced on Wednesday that it had completed the acquisition of a 19.9% stake in Scandinavian airline SAS, for 144.5 million dollars. Construction and concessions group Vinci (+0.7%) reported on Tuesday evening a 6% year-on-year increase in airport traffic in July, while motorway traffic fell by 3.1% at the same time. Hotel group Accor (-0.2%) confirmed on Wednesday its intention to optimise its hybrid debt with the issue of €500 million of new hybrid bonds, accompanied by the launch of a buyback offer for €500 million of existing bonds. TotalEnergies (-0.5%) will continue to cap its pump prices at €1.99 per litre in 2025, the energy company's chairman and CEO Patrick Pouyanné said on BFMTV on Tuesday evening. One of the group's trading subsidiaries has also been fined $48 million (around €43 million) by the US commodities regulator, which accuses it of attempting to manipulate the reference price of a petrol futures contract.

United States
The New York Stock Exchange closed lower on Wednesday amid a wait-and-see mood ahead of results from artificial intelligence chip giant Nvidia. The Dow Jones Industrial Average (DJIA) lost 0.4% to 41,091.42 points, while the broader S&P 500 index gave up 0.6% to 5,552.20 points. The tech-heavy Nasdaq Composite shed 1.1% to 17,556.03 points. Super Micro Computer (-19%) announced that it would not publish its annual report for the financial year ended June on time. The Indian competition authority gave a conditional green light to the merger of the local activities of US entertainment giant Walt Disney (-1.6%) with those of Indian conglomerate Reliance. Berkshire Hathaway has continued to sell Bank of America shares (+0.7%) in these past few days, disposing of nearly 982 million dollars worth of shares. PVH (-6.4%), owner of the Tommy Hilfiger and Calvin Klein brands, published better-than-expected results for its second fiscal quarter, although sales of its international activities declined by 4% year-on-year, mainly due to the difficult consumer environment in Asia-Pacific.

Asia
Moderate losses defined the picture on the stock markets in East Asia and Australia on Thursday. In Taiwan, the shares of chip manufacturer Taiwan Semiconductor Manufacturing (TSMC) fell by around 2 per cent, while Foxconn lost 0.7 per cent. SK Hynix dropped 5.6 per cent in Seoul and Samsung Electronics 3.1 per cent. In Tokyo, Advantest declined by only 0.2 per cent after initial losses, while Tokyo Electron was down 0.3 per cent. Meanwhile, the losses across the board are mostly small. The Kospi in Seoul suffered the biggest setback. The index shed 0.9 per cent, weighed down by heavyweight Samsung Electronics. The Hang Seng Index in Hong Kong slipped 0.7 per cent. In Shanghai, the Composite Index lost 0.5 per cent. In Tokyo, the Nikkei 225 index is now little changed at 38,380 points. The Australian S&P/ASX-200 decreased by 0.3 per cent. Looking at individual stocks, Li Auto in Hong Kong slumped by 16 per cent following disappointing figures. The company's profit halved in the second quarter. Meanwhile, BYD (-2.2 per cent) reported lower Chinese demand. In Sydney, South32 gained 0.8 per cent after the mining group exceeded expectations with its adjusted figures for the 2023/24 financial year and announced a share buyback.

Bonds
U.S. bond yields were little changed early Wednesday as investors eyed jobs and inflation data in the next few sessions. The 10-year Treasury note yield closed virtually unchanged at 3.841%. The 2-year Treasury note yield also stalled at 3.869%.

Analysis
Barclays downgrades Nestle to 95 (110) CHF/Overweight - Trader
Price target Accelleron: UBS upgrades to CHF 47 (42.90) - Buy
Target price Sonova: JPMorgan lowers to CHF 227 (255) - Neutral

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