Markets Today: NFP in Focus as Rate Cut Bets Tumble, NVIDIA Earnings Boost Sentiment
European stock markets rose on Thursday, driven by a general feeling of relief across global markets. This positive mood followed the strong financial results reported by Nvidia.
The main European stock index, the STOXX 600, was up by 1%, with markets in Germany and France also increasing by more than 1%. Nvidia’s excellent quarterly results and promising future outlook came at a critical time, helping to calm investors who had been worried in recent weeks about a possible global AI bubble. Even though some concerns about an AI bubble still exist, Nvidia’s performance temporarily lessened the anxiety, causing its shares listed in Frankfurt to jump by 6.2%.
The European technology index climbed by 1.8%, with chip-related companies like Infineon and ASML both gaining 2.8%. Companies that make equipment for the AI boom, such as Schneider Electric and Siemens Energy, also saw increases of 2% and 4%, respectively.
In company news, French bank BNP Paribas saw its shares rise by 5.7% after it announced a higher target for its financial stability measure (the CET1 ratio) for the year 2027.
On the FX front, the US dollar was strong on Thursday, having achieved its biggest single-day gain in six weeks. This strength came after notes from the Federal Reserve meeting suggested it was less likely that the US would cut interest rates in December.
Meanwhile, the Japanese yen fell significantly because people are betting that Japan will not immediately intervene to stop the currency from weakening. The yen hit its lowest level in 10 months at 157.48. This decline started after Japan’s Finance Minister indicated that there were no specific talks about foreign exchange at a meeting with the Bank of Japan Governor.
Other major currencies also weakened against the dollar: the euro fell to a two-week low of $1.1510, and the British pound (sterling) slipped to $1.3040. The New Zealand dollar had dropped sharply the day before, hitting a seven-month low of $0.5591, mainly because interest rate expectations in New Zealand are moving away from those in the US; it was stable on Thursday at $0.5611.
Overall, the dollar index, which measures the dollar’s strength against a basket of currencies, rose by 0.5% overnight and continued to climb, settling at 100.25.
Currency Power Balance
