Tech stocks rally on Wall Street as Anthropic eyes US$30 trillion market
Oil prices ease after Bessent’s ‘economic D-day’.
Tech stocks were back in favour on Wall Street, with chipmaker Nvidia set to snap its losing streak ahead of its latest quarterly update, while Anthropic’s estimates of the artificial intelligence market are even loftier than SpaceX’s view.
Brent crude oil prices dipped below US$90 a barrel as US Treasury secretary Scott Bessent’s plans to further isolate Iran were seen as not antagonising China unnecessarily, although his plans to rein in the bond market copped criticism from his longtime mentor, hedge fund veteran Stanley Druckenmiller.
Meanwhile, International Monetary Fund managing director Kristalina Georgieva urged governments to get their books in order, ahead of Federal Reserve chair Kevin Warsh’s keynote speech at the annual central bankers’ symposium in Wyoming later this week.
The generally upbeat sentiment is set to flow through to the antipodes, with the kiwi dollar stronger and ASX futures pointing to a positive start to the day across the Tasman as earnings season continues, with Woolworths, WiseTech Global and Meridian Energy among companies reporting today.
Big numbers
Nvidia was on track to snap a seven-day losing streak, with the Nasdaq Composite up 0.6% in late trading as investors regained their appetite for tech companies. The chipmaker is due to report its quarterly earnings on Wednesday in the US.
“The earnings are arguably the most important corporate event of the week,” Greg Boland, market strategy consultant at Moomoo, said in a note. “Investors will be looking closely at Blackwell shipments, data-centre revenue, hyperscaler capital expenditure and Nvidia's guidance for the coming quarter.”
The Wall Street Journal reported Anthropic would likely tell investors its total addressable market was US$30 trillion, topping the US$29.5 trillion figure put forward in SpaceX’s blockbuster initial public offering documents.
Meanwhile, OpenAI said its new Jalapeno chips outperformed Nvidia’s current crop of AI processors, although the WSJ separately reported the ChatGPT maker lost another key executive, with the departure of Chris Malone who oversaw its data centre buildout.
And Nvidia-backed AI cloud-computing provider Lambda was reportedly in talks to raise as much as US$3 billion ahead of a potential listing next year.
Gains on Wall Street were widespread, with the S&P 500 and Dow Jones Industrial Average both up 0.3%, while across the Atlantic, the UK’s FTSE 100 rose 0.3% and Germany’s DAX gained 0.6%. France’s CAC 40 dipped 0.2%.
Fuelling gains
Brent crude oil futures fell 3.9% to US$88.60 a barrel as investors took heart from the fact that the latest round of US sanctions on Iran stopped short of directly penalising China, which said it would take all necessary measures to protect its interests.
Separately, Iran and Oman said they’d discussed a proposed framework to set up a temporary corridor for ships to go through the Strait of Hormuz.
The softer oil prices helped support bonds, with the yield on 10-year US treasuries falling 8 basis points to 4.64%. Veteran hedge fund manager Stanley Druckenmiller penned an op-ed in the WSJ criticising US Treasury secretary Bessent’s bond-buying programme, saying governments defending prices against fundamentals always lose.
Meanwhile, IMF head Georgieva said the global economy had been resilient in the face of stubborn inflation, while urging governments to keep their debt levels and deficits at sustainable levels.
Canada matched the new tariffs imposed by US President Donald Trump, doubling its levies on a range of products to 50%, although Canadian lenders Bank of Nova Scotia and Bank of Montreal played down trade concerns as their respective quarterly earnings beat analysts’ expectations.
SpaceX was up 2.3% in late trading after the space conglomerate said it planned to build a US$100 billion rocket launch complex in Louisiana, while rocket parts maker Ursa Major Technologies planned to go public through a special purpose acquisition company at a US$2.3 billion valuation.
Nasdaq-listed local favourite Rocket Lab was down 2.2% at US$66.73 in late trading.
Australian futures are pointing to a 0.3% gain for the S&P/ASX 200 index when trading opens across the Tasman as earnings season continues, while Australian inflation figures are also in focus. The kiwi dollar traded at 83.43 Australian cents at 7am in Auckland from 83.32 cents yesterday, and rose to 59.73 US cents from 59.56 cents.
Moomoo’s Boland said New Zealand’s S&P/NZX 50 index would probably start the trading day on a firmer footing, with Wall Street’s rally, cheaper oil and lower bond yields supporting investor sentiment.
“For New Zealand investors, falling oil prices are particularly constructive given their potential to reduce imported inflation pressure, although the kiwi's move back towards 60 US cents will also be watched,” Boland said.
Among companies reporting in New Zealand today are Meridian, Steel & Tube Holdings, Winton Land and Scales Corp, while Third Age Health Services holds a virtual annual meeting.
