White House gets in behind AI giants as Nvidia’s Huang pushes G20 to go faster

US President Donald Trump’s administration flexed its close ties with the artificial intelligence giants, throwing its support behind OpenAI in its dispute with the New York Times and confirming a thawing in relations with Anthropic, while Nvidia chief Jensen Huang urged the 20 biggest economies to embrace AI technology.

Stocks on Wall Street were on track to snap a three-day decline, even as government bond yields remained elevated after renewed tensions in the Middle East drove up oil prices and raised fears that the Federal Reserve and other central banks would have to raise interest rates to keep a lid on inflation.

Alphabet was one of five Magnificent 7 megacap stocks on the green side of the ledger after a federal judge rejected the US Department of Justice’s attempt to have Google’s online advertising business split up, the second time a court has turned down efforts to break up the company.

And Japan’s yen rallied amid growing speculation that the Bank of Japan and the Japanese government were preparing to intervene in currency markets again, while Berkshire Hathaway chief executive Greg Abel reaffirmed his commitment to the five Japanese trading houses his firm has built sizeable stakes in.

The new captains of industry

Nvidia rose 3.2% in late trading to lead the Dow Jones Industrial Average higher as stocks on Wall Street clawed back some of their losses in recent days.

The chipmaker’s CEO Jensen Huang urged Group of 20 nations ministers to accelerate their AI adoption to drive growth, saying the worst outcome they could face was being left behind.

Meanwhile, Axios reported US commerce secretary Howard Lutnick said Anthropic was back on side with the White House after relations cooled when defence secretary Pete Hegseth blocked the AI model developer from certain military contracts.

And the Trump administration’s increasingly close ties with AI firms was on display in its support of OpenAI in a dispute with the NY Times over the use of the publisher’s work to train the large language models behind ChatGPT. The White House filed a brief in Manhattan federal court, saying AI training generally made fair use of copyrighted material.

Meanwhile, New York City said it was banning the use of AI in public schools for a year while officials study the impact of the technology in classrooms.

The Federal Reserve’s Beige Book survey of regional businesses showed modest economic growth in the past two months, with data centres a key driver.

Stocks on Wall Street rallied, with the Dow and S&P 500 both up 0.5% in late trading, while the tech-heavy Nasdaq Composite rose 0.4%, with investors shaking off persistently high government bond yields and oil prices. Brent crude oil futures rose 0.7% to US$95.33 a barrel.

“After Tuesday's sharp technology sell-off, US equities have stabilised, with Nvidia recovering strongly and Dell surging after its earnings,” Moomoo market strategy consultant Greg Boland said in a note. “Breadth has strengthened, indicating the rebound is spreading beyond the mega-cap technology names.”

Let’s stick together

Alphabet was among the day’s gainers after a federal court rejected the Justice Department’s bid to split Google’s online ad business, the second time a court rejected efforts to break up the company over its illegal tactics.

Separately, Bloomberg reported Alphabet’s Waymo was in talks to raise debt for the first time, seeking more than US$3 billion from the likes of Pimco, Blackstone and Sixth Street Partners.

Meanwhile, Uber rallied after the ride-share company said it would cut 10% of its global workforce, roughly 3,300 roles, in an effort to strip out management layers. Separately, the board of Germany’s Delivery Hero recommended shareholders accept Uber’s US$14.8 billion takeover offer.

Stock markets across the Atlantic remained subdued, with the UK’s FTSE 100 and France’s CAC 40 both down 0.3%, while Germany’s DAX declined 0.5%.

The yen strengthened as currency traders were on alert for more intervention by Japanese authorities, with the kiwi sliding to 92.80 yen at 7am in Auckland from 93.32 yen yesterday.

Meanwhile, Berkshire Hathaway chief Greg Abel told CNBC that the stakes his firm built in Mitsubishi Corp, Mitsui & Co, Itochu Corp, Sumitomo and Marubeni were long-term investments that he intended to hold for many decades.

Australian futures pointed to a 0.3% gain for the S&P/ASX 200 index when trading opens across the Tasman, while the kiwi dollar traded at 58.45 US cents from 58.30 cents yesterday.

Moomoo’s Boland said New Zealand’s market was set for a stronger open after yesterday’s Reserve Bank policy review projected a more gradual increase in rates than investors had anticipated, which boded well for interest rate-sensitive stocks.

Bond traders are pricing in just 8 basis points of increases at the RBNZ’s October review, down from 41 basis points before yesterday’s meeting.

Local data today include Statistics New Zealand’s June quarter terms of trade.

Meanwhile, Meridian Energy and Precinct Properties NZ go ex-dividend today.

Reporting by Paul McBeth. Image from Solen Feyissa on Unsplash.