Nvidia Earnings Lift Asian Markets, Calming AI Bubble Worries

Most Asian shares rose significantly on Thursday following Nvidia’s better-than-expected quarterly earnings, easing fears that AI-driven stock prices might have become overinflated. 

U.S. futures and oil prices increased as well. Japan’s Nikkei 225 initially climbed up to 4.2% before trimming some gains; by early afternoon, it stood at 2.6% higher at 49,801.81, buoyed by a rally in technology stocks and investors’ optimism from Nvidia’s $57 billion quarterly revenue report, which exceeded forecasts and was released after U.S. trading hours. 

South Korea’s Kospi gained 3% to 4,047.57, driven by tech and energy stocks, as investor enthusiasm was fueled by Nvidia’s earnings and reports that the U.S. might postpone planned semiconductor tariffs. 

Samsung Electronics rose 6.1%, while SK Hynix increased 3.5%. Chinese markets saw modest gains: Hong Kong’s Hang Seng Index edged up 0.1% to 25,867.87, Shanghai composite increased 0.4% to 3,961.71, while Taiwan’s Taiex climbed 3.2%. Australia’s S&P/ASX 200 rose 1.2% to 8,546.10, mainly driven by gains in technology stocks.

On Wednesday, the U.S. stock market experienced a volatile day amid anticipation of key upcoming data, with the S&P 500 rising 0.4% to break a four-day losing streak. The Dow gained 47 points (0.1%), and the Nasdaq rose 0.6%.

Constellation Energy surged 5.3% after the U.S. Department of Energy announced a $1 billion loan to restart its Three Mile Island nuclear plant. Lowe’s increased 4% following better-than-expected summer profits, while Target declined 2.8% amid weaker quarterly revenue and concerns about ongoing challenges during holiday sales.

 Nvidia was the market’s focus, climbing 2.8% before earnings and 5.1% after hours. It has become the most valuable stock on Wall Street, briefly surpassing $5 trillion and influencing the S&P 500’s direction.

 Nvidia’s ability to maintain higher profits can soothe criticism of its lofty valuation, as profits typically drive stock prices over the long term. As a key player in the AI boom, Nvidia’s chips fuel many companies’ AI investments. 

Traders also prepared for Thursday’s U.S. September jobs report. The slowing job market has prompted two rate cuts by the Federal Reserve this year, with more expected, though some officials hint at a pause due to persistent inflation above 2%.

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 In commodities, US crude rose 16 cents to $59.41, and Brent crude also increased 16 cents to $63.67. The U.S. dollar strengthened to 157.32 Yen from 157.15, amid expectations that Japan might delay efforts to reduce its national debt as Prime Minister Sanae Takaichi increases spending to stimulate the economy.