Asian Tech Shares Rise Before Nvidia’s Earnings: Markets Wrap

Technology shares advanced in Asia before Nvidia Corp.’s earnings as investors awaited its take on chip demand to gauge the sustainability of a global stock rally since April.

The artificial intelligence theme remains a focus with Chinese AI linchpin Cambricon Technologies Corp. jumping as much as 8.2% to its highest ever after a record profit. Nikon Corp. shares jumped 21% in Japan. Nvidia will report after the bell Wednesday. A gauge of Asian technology shares rose as much as 0.6% while a broader regional index was flat.

The Chinese yuan rose to its strongest level against the dollar since November. The dollar and Treasuries steadied after they declined following President Donald Trump’s push to oust Federal Reserve Governor Lisa Cook. Long-dated bonds from the US to France and the UK slumped on Tuesday.

While Trump’s move captured much of the market’s attention, traders face key risks this week from Nvidia’s earnings and Friday’s inflation report. Even with political headlines flaring, investors remain anchored to a bullish market script: a likely September interest-rate cut, resilient economic growth, and strong company earnings to keep equity sentiment afloat.

“Equity markets will be looking squarely at Nvidia’s upcoming earnings report for cues as to whether the current bull run continues or stalls out,” wrote Tim Waterer, chief market analyst at KCM Trade.

Nvidia’s is expected to update on the AI spending boom and how the US-China rivalry is limiting growth. Analysts estimate that the biggest buyers of AI hardware are still investing heavily in new gear, with the company’s sales set to grow at a pace of more than 50% this year.

Dimming the excitement is confusion over how much business Nvidia will be able to do in China.

“Nvidia’s results transcend the company, becoming a barometer of macroeconomic activity, a talisman for the artificial intelligence trade, and a critical pressure point for global geopolitics,” wrote Kyle Rodda, a senior market analyst at Capital.com in Melbourne.

Meanwhile, Trump said he was prepared for a legal fight while the Fed, weighing in for the first time this week, said it would abide by any court decision in Cook’s legal challenge of her dismissal.

The Fed’s perceived independence from government whims is a bedrock assumption of US markets, and any change to that perception could weigh on US credit ratings.

“Trump’s push to fire Cook has exacerbated concerns about the Fed’s independence,” said Ian Lyngen at BMO Capital Markets. “While the price action in US rates has been largely contained to the recent range, many of the go-to hedges against an erosion of Fed independence outperformed on the news of Cook’s firing.”

In China, data showed industrial companies saw their profits fall at a slower pace in July, in a potential sign that efforts to curb overcapacity are starting to ease the strain from aggressive competition among producers.

Economic data Tuesday showed US orders for business equipment increased in July by more than projected, suggesting companies are moving forward on investment plans as uncertainty around trade and tax policy gradually diminishes. Also, consumer confidence fell slightly in August as Americans worried more about their prospects of finding a job.

On the trade front, the US will slap a crushing 50% tariff on some Indian goods starting Wednesday — the highest in Asia — as Trump presses ahead with the levies to punish New Delhi for buying Russian oil. Crude oil held its steep drop Tuesday.

Some of the main moves in markets:

Stocks

• S&P 500 futures were little changed as of 11:59 a.m. Tokyo time

• Japan’s Topix fell 0.1%

• Australia’s S&P/ASX 200 rose 0.1%

• Hong Kong’s Hang Seng was little changed

• The Shanghai Composite was little changed

• Euro Stoxx 50 futures rose 0.4%

Currencies

• The Bloomberg Dollar Spot Index was little changed

• The euro was little changed at $1.1631

• The Japanese yen fell 0.2% to 147.72 per dollar

• The offshore yuan was little changed at 7.1530 per dollar

Cryptocurrencies

• Bitcoin fell 0.2% to $111,185.23

• Ether fell 0.1% to $4,580.92

Bonds

• The yield on 10-year Treasuries was little changed at 4.27%

• Japan’s 10-year yield was unchanged at 1.625%

• Australia’s 10-year yield advanced one basis point to 4.33%

Commodities

• West Texas Intermediate crude rose 0.2% to $63.35 a barrel

• Spot gold fell 0.3% to $3,384.24 an ounce