Nvidia's market surge feels like GameStop frenzy
In just two weeks, Nvidia's market value has soared by over $500 billion, surpassing Intel and AMD combined. This massive rise, fuelled by a strong AI-driven first-quarter report, resembles a 'gamma squeeze'.
When investors buy call options, market makers buy stock to hedge, pushing prices up even more.
This situation echoes the GameStop rally of 2021 but is backed by Nvidia's solid profits and booming revenues. Nvidia's growth seems more sustainable, driven by its high demand in AI technology.
Trafigura's profits plummet as energy crisis eases
Trafigura's profit dropped 73% in the first half of 2024, marking its lowest since 2020, as the energy crisis faded. The company's net profit fell to $1.47 billion, down from a record $5.5 billion the previous year, with revenue dipping by 5.4%.
Despite the decline, earnings are still high compared to pre-2020 levels. The energy division's profit halved, while metals saw an 11% rise. Trafigura is dealing with setbacks like the nickel fraud and losses in Mongolia.
The company is also seeing a shift in senior management and declared lower dividends compared to last year.
European stocks rise as ECB set to cut interest rates
European shares climbed for the second day, with the Stoxx 600 Index up 0.6%, led by technology and healthcare stocks.
Novo Nordisk saw a notable 3.5% rise. The European Central Bank is expected to cut its deposit rate by a quarter-point to 3.75%, after maintaining a peak of 4% to control inflation. Investors are keenly watching for future guidance from ECB President Christine Lagarde.
The ECB's anticipated rate cut could drive regional equities to new highs, though the path ahead remains uncertain. European banks, real estate, and athleisure stocks like Lululemon may see active trading.
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