US EQUITY OPEN: NVDA/MU strength leads Tech higher, as Trump/Xi summit awaits
OPEN: US indices opened mixed, with RUT, DJI seeing losses, SPX flat, and the NDX outperforming, and buoyed by strength in NVDA (+2.5%) and MU (+4.6%). Nvidia (NVDA) CEO has joined Trump on his trip to China, while Micron (MU) saw a chunky BofA PT lift. Focus resides around the Trump/Xi summit, as well as geopols, albeit nothing incrementally new on that footing. US PPI was hotter than expected across the board, and saw indices and Treasuries fall, while the Dollar rose as it showed signs of broader price pressures beyond energy. Kiwi is the G10 FX laggard, and hit on higher than anticipated inflation expectations, following on from the recent poor GDP print - raising stagflationary concerns. In the UK, focus resides around PM Starmer’s future, as he continues to be under significant pressure. WTI and Brent are lower by c. USD 0.40/bbl, with precious metals mixed as gold sits in the red and silver in the green. Sectors are predominantly weaker, with Tech outperforming on aforementioned names, while Utilities lag. Ahead, the US 30yr bond auction, Fed appearances from Collins, Kashkari, and CSCO earnings after-hours are the highlights.
STOCK SPECIFICS:
- Nvidia (NVDA): CEO Huang joins Trump’s China trip, igniting hopes for an H200 deal.
- Micron (MU): BofA raised its PT on Co. to $950 (prev. $500).
- Alibaba (BABA): Rev. way light
- Nextpower (NXT): EPS & rev. topped alongside raising FY top line guidance
- Nebius (NBIS): Adj. EBITDA & rev. beat
- EchoStar (SATS): FCC approved Cos. $40bln sale of wireless spectrum t T & SpaceX.
- Wix (WIX): Top & bottom line disappointed
The mixed performance of US indices at the open, particularly the outperformance in tech led by Nvidia and Micron, reflects market optimism ahead of the Trump/Xi summit. This geopolitical summit remains a key focus, as any outcomes could significantly impact sentiment and market direction, especially in the tech sector which is currently buoyed by positive news from prominent players like NVDA and MU. The mixed signals from economic data, particularly the hotter-than-expected PPI, further complicate the outlook, highlighting inflation pressures and potentially influencing future Fed policy decisions.