Futures Jump As "Good Enough" Nvidia Results Reboot Rally

US equity futures are higher post-NVDA, though the stock’s reaction was a bit muted with the stock rising ~2% pre-market, a far cry from the 10% swing that was priced in by straddles ahead of earnings (and why both puts and calls will expire worthless). As of 8:00am ET, S&P futures are up 0.6%, and Nasdaq futures rise 0.8%, with all Mag7 stocks higher, and Semis and Fins also stronger. Bond yields are up 5bps from 2s to 30s with USD poised to have its strongest day in 5 sessions as yen drops sharply after stops are triggered around 149.40. Commodites are weaker ex-Energy although WTI remains below $70/bbl. Today’s macro data focus is on Durable/Cap Goods and Jobless data. Notably, both Asian and European stocks are weaker today, prompting JPM to ask if „this the beginning of a rotation back to US TMT?”

In premarket trading, Nvidia ticks 2.4% higher after the chipmaker delivered good-but-not-great quarterly numbers. As for the other Magnificent Seven stocks, Tesla and Meta Platforms are top gainers (Alphabet +0.8%, Amazon +1.7%, Apple -0.1%, Microsoft +0.4%, Meta Platforms +1.5% and Tesla +2%). EBay tumbled 7% after projecting sales for the current quarter that missed analysts’ estimates, guidance that Chief Executive Officer Jamie Iannone attributed to soft demand in Germany and the UK. Snowflake (SNOW) jumps 12% after the cloud-computing company gave an outlook for product revenue that is above the analyst consensus. Salesforce (CRM) shares fall 3% after the software company gave an outlook that is weaker than expected. Here are some other notable premarket movers:

• Ambarella (AMBA) climbs 12% after the semiconductor device company gave an outlook that is seen as strong.
• Ferrari (RACE) drops 3% after the Agnelli family sold a $3.14 billion stake in Ferrari NV to fund what it calls a “sizeable new acquisition” and stock buyback.
• Ibotta (IBTA) tumbles 41% after the digital marketing software firm issued forecasts for the current quarter that fell short of Wall Street expectations.
• Mara Holdings (MARA) rises 13% after the crypto mining firm reported total revenue for the fourth quarter that beat the average analyst estimate.
• Nutanix (NTNX) jumps 15% after the infrastructure software company boosted its full-year revenue guidance and reported second-quarter adjusted earnings per share that beat estimates.
• Papa John’s (PZZA) gains 6% after fourth quarter profit and revenue beat estimates.
• Paramount Global (PARA) slips 2% after the parent of CBS and MTV reported fourth-quarter sales and profit that fell short of analysts’ expectations, as gains in streaming failed to offset declines in traditional TV.
• Pure Storage (PSTG) declines 8% after the cloud storage provider’s provided disappointing guidance for operating income. Also, the company’s fourth-quarter subscription services revenue failed to meet estimates.
• Root (ROOT) rises 18% after the insurance company’s fourth quarter net premiums written beat estimates
• Tandem Diabetes (TNDM) falls 17% after as competition hurt US sales. Leerink called the fourth quarter “a challenging quarter to digest.”
• Teleflex (TFX) slips 5% after announcing plans to separate into two publicly traded companies.
• Warby Parker (WRBY) rises 6% after the eyeglass retailer provided a rosy sales outlook. The company also announced a partnership with Target Corp. for five Warby Parker at Target shop-in-shops in 2025.

Nvidia’s largely positive, if hardly blowout. results come only a month after Chinese startup DeepSeek challenged US Big Tech’s artificial intelligence spending with its cheaper AI model. The picture for tech investors is made even more complex by US President Donald Trump’s administration pressuring allies to escalate curbs on China’s semiconductor industry. “While we continue to highlight volatility in the near term amid macro uncertainty, US-China tensions, tariffs, and geopolitical developments, we believe the broader AI trend remains intact,” said Mark Haefele, chief investment officer at UBS Global Wealth Management.

Investors are also confronting a murky outlook for US trade tariffs, after Trump threatened to impose 25% levies on European Union imports sending stocks lower by 0.4%, and off its record high, with the auto sector the biggest laggard. Trump gave contradictory statements Wednesday on the implementation of tariffs, keeping investors guessing. A White House official said the European levies could affect all exports from the block, or only specific sectors. The US remains on track to put levies on Mexico and Canada, however it is unclear if they are going to be enacted in March.

“The market wants to see the implementation to price in the worst,” said Michael Nizard of Edmond de Rothschild Asset Management. “Up until now, it was negotiations and the market doesn’t want to correct more.”

Commenting on the outlook for US stocks, JPMorgan’s Ilan Benhamou said they will struggle early March amid weaker economic data before they rally again later in spring. “In the immediate future, things are too messy for stocks to break out, and I think the market is stuck,” Benhamou, who works in equity derivatives sales, wrote in a note to clients.

Elsewhere, Initial jobless claims and revised fourth-quarter gross domestic product numbers feature in a flurry of readings due later that investors will parse for any further evidence of slowing growth. Money markets have boosted Federal Reserve easing bets to fully price two quarter-point cuts this year compared to just one reduction two weeks ago.

European stocks were left behind in today bounce, after US President Trump said he would impose 25% tariffs on imports from the European Union. The Stoxx 600 is off the lows but still down 0.5%, led lower by automakers as European stocka trim yesterday’s record high in early Thursday trading, with declines led by automakers on renewed tariff uncertainty from the US. The region’s most significant movers are driven by company earnings in another busy report day in Europe, with Rolls-Royce and Technip surging, and Ocado and WPP sinking on their respective reports. Here are the biggest movers Thursday:

• Rolls-Royce soars as much as 16% to a fresh record as the jet-engine maker’s results beat estimates and the outlook is upgraded. Analysts also welcomed the launch of a £1b buyback starting immediately
• Technip Energies shares rise as much as 11% to a record high after the company reported results that topped expectations. Analysts highlighted the strong order intake and favorable outlook
• Engie shares gain as much as 6.5% to the highest level since 2015 after the French utility raised its profit guidance for 2025, a move that will imply consensus upgrades, according to analysts
• Eiffage shares rise as much as 6.7%, the most since March 2022, after results from the French infrastructure company were accompanied by what CIC analysts described as “a good surprise”
• Man Group shares rise as much as 5.7%, their best one-day gain in nearly a year, after the investment management firm reported better-than-expected results and announced a $100 million share buyback
• Swiss Re shares climb as much as 2.8% after the insurer reported an earnings beat and lower-than-expected costs for the recent Californian wildfires. Analysts said the report was “reassuring”
• Beiersdorf gains as much as 2.4%, most in a month, after the German personal and healthcare group reported earnings. Analysts say the relatively solid report and outlook should support shares
• Ocado shares decline as much as 16% after the company’s growth forecast for the technology solutions business missed analyst estimates. The segment’s weakness dampen hopes of a growth acceleration
• WPP shares sink as much as 16%, the steepest drop since the start of the Covid-19 pandemic, after the advertising firm forecast another year of revenue decline in 2025, which undershot analysts’ estimates
• Sopra Steria shares fall as much as 15%, the most since October 2020, after the French software company set what CIC analysts described as “cautious targets for 2025” alongside in-line results
• Syensqo shares plunge as much as 12%, the most on record, after the chemical manufacturer issued disappointing guidance that will weigh on investor expectations, according to Citi
• EDP falls after announcingwill reduce its gross investment per year to €4.4b on average in 2025-2026, according to a presentation posted on the Portuguese securities regulator’s website late on Wednesday

Earlier in the session, Asian stocks fell as equities in Hong Kong pulled back after a strong rally spurred by a slew of positive developments. The MSCI Asia Pacific Index declined as much as 0.5%, weighed by tech firms including Xiaomi and Alibaba. Shares dropped in Taiwan and South Korea, while those in Japan rose. Investor sentiment remained cautious amid mixed messages from Donald Trump and uncertainty over US tariffs on Chinese imports. Trump expressed interest in having China invest in the US just days after he ordered restrictions to Chinese spending in some sectors. “The key uncertainty remains on how much of these tariff threats will eventually materialize, though broad resilience in market sentiments suggests that market participants are still expecting somewhat of a negotiated outcome with minimal tariff implementation,” Yeap Jun Rong, market strategist at IG Asia Pte in Singapore, wrote in a note. Earnings from Nvidia also failed to impress investors, with the company’s shares falling in after-hours trading after the chipmaker delivered results.

In rates, Treasuries fallwith the curve cheaper by 3bp to 5bp across maturities, after a curve-steepening selloff picked up steam during London morning. 10-year yield rises 5bps around 4.3% is near session high and cheaper vs bunds and gilts in the sector by ~3bp; 2s10s curve is ~1bp steeper on the day. The US session includes 4Q GDP revision, weekly jobless claims data and six scheduled Fed speakers. Bunds and gilts pared opening gains to trade slightly lower on the day. German and UK 10-year borrowing costs rise 2 bps each. Spanish headline inflation matched expectations and prompted little reaction in European Central Bank interest-rate cut bets.

In FX, the Bloomberg Dollar Spot Index rises 0.2%. The yen is the weakest of the G-10 currencies, falling 0.6% against the dollar and pushing USD/JPY up toward 150. The Swiss franc is a close second, falling 0.4%.

In commodities, spot gold drops $25 to around $2,891/oz. Bitcoin rises 2% and above $86,000.

The US economic data calendar includes first revision of 4Q GDP estimate, January durable goods orders and weekly jobless claims (8:30am), January pending home sales (10am) and February Kansas City Fed manufacturing activity (11am). Fed speaker slate also includes Barkin (8:15am), Schmid (9:15am), Barr (10am), Bowman (11:45am), Hammack (1:15pm) and Harker (3:15pm)

Market Snapshot

• S&P 500 futures up 0.5% to 6,003.00
• STOXX Europe 600 down 0.4% to 557.37
• MXAP down 0.3% to 188.35
• MXAPJ down 0.7% to 592.16
• Nikkei up 0.3% to 38,256.17
• Topix up 0.7% to 2,736.25
• Hang Seng Index down 0.3% to 23,718.29
• Shanghai Composite up 0.2% to 3,388.06
• Sensex up 0.1% to 74,682.30
• Australia S&P/ASX 200 up 0.3% to 8,268.22
• Kospi down 0.7% to 2,621.75
• German 10Y yield little changed at 2.44%
• Euro little changed at $1.0477
• Brent Futures up 0.7% to $73.02/bbl
• Gold spot down 0.9% to $2,889.19
• US Dollar Index up 0.20% to 106.63

Top Overnight News

• US President Trump issued an executive order to implement DOGE’s government efficiency initiative which deals with federal spending on contracts, grants, and loans: White House.
• House Republicans spent weeks in painstaking negotiations before delivering a budget blueprint for “one big, beautiful bill.” Despite a razor-thin 217-215 House vote Tuesday, GOP senators indicated Wednesday they would not accept Speaker Mike Johnson’s fiscal framework as-is. Politico
• US President Trump has assured House and Senate Republicans he intends to open up his stockpile of campaign reserves to defend the party’s slim majorities in both chambers next year: CNN.
• US Senate Majority Leader Thune told Punchbowl „I’m not exactly sure where the 8% number or argument is coming from”, in relation to Pentagon spending cuts.
• Canadian officials are undertaking a “full court press” in Washington this week to avert 25% tariffs on most of the nation’s goods, a minister said. BBG
• Microsoft is pushing the Trump administration to loosen and simplify a new system that would restrict the sales of cutting-edge U.S. artificial-intelligence chips to much of the world. WSJ
• China’s securities regulator has clamped down on small companies’ listings on New York stock exchanges after many of them became vehicles for price-rigging, causing heavy losses for US investors. The rate of China-approved applications for US IPOs has slowed noticeably in the past year, falling from 22 in the 1H24 to 11 since June. FT
• Japan births tumble to the lowest level since records began 125 years ago as the country’s demographic crisis deepens and government efforts to reverse the decline continue to fail (births fell 5% in ’24 to 720,988). FT
• China’s No. 4 official unveiled tougher language on Taiwan, urging efforts to “shape the inevitable reunification.” BBG
• Indian officials are exploring ways to lower tariffs on a wide range of imports, including cars and chemicals, in a bid to evade US President Donald Trump’s threatened reciprocal levies, according to people familiar with the matter. BBG
• UK PM Starmer will warn Trump on Thursday at the White House that any Ukraine peace agreement will require some type of a security guarantee from the US in order to be credible. FT
• Israel and Hamas began an exchange of the bodies of four hostages for hundreds of Palestinian prisoners, the final swap in a six-week ceasefire due to end this weekend. BBG

A more detailed look at global markets courtesy of Newsquawk

APAC stocks followed suit to the mixed performance stateside for most of the session after tariff-related confusion and NVIDIA’s earnings. ASX 200 edged mild gains amid outperformance in Consumer Staples following earnings from supermarket heavyweight Coles but with the upside limited amid losses in tech and after disappointing capex data. Nikkei 225 swung between gains and losses amid a quiet calendar and choppy currency, while Seven & I Holdings was the worst performer after the founding family’s management buyout fell through. Hang Seng and Shanghai Comp were initially pressured as trade frictions remain in the spotlight with US Commerce Secretary Lutnick recently commenting that China is his biggest concern and that they will prevent Chinese vehicles from entering the US market, while it was also reported that China is putting the breaks on US stock listings for domestic companies.

Top Asian News

• Chinese Commerce Ministry, on possible US trade deal, says China’s MOFCOM has been maintaining communication with US counterparts.
• Thai government engages in preliminary talks with automakers regarding potential car trade-in and scrappage initiative, according to Reuters sources.
• China set to boost financial support for EV charging facilities, according to Bloomberg.
• Chinas Financial Regulator encourages banks and insurers to enhance medium-to-long term lending support to tech innovation and equipment upgrades in sectors including steel, nonferrous metals, and petrochemicals.
• MediaTek (2454 TT) FY24 (TWD): Net profit 106.4bln (exp. 115.05bln), Co. is to pay cash dividend of TWD 40bln or TWD 25/shr.

European bourses (STOXX 600 -0.3%) are in the red (ex-FTSE 100 +0.2%), with sentiment hit amid the latest Trump tariff related commentary on the EU. On the former, the US President said that he will be announcing tariffs on the EU very soon and that the EU can try to retaliate on tariffs, as well as noted that EU tariffs are to be 25% on autos and other things. European sectors hold a strong negative bias, and with those in the green only modestly so. Telecoms remains afloat, joined closely by Travel & Leisure and then Energy. Autos is by far the clear underperformer, as the sector reacts to US President Trump’s commentary that EU tariffs are to be 25% on autos and other things.

Top European News

• French President Macron and incoming German Chancellor Merz agree to „open a new chapter in Franco-German relations”, according to Reuters sources.
• French Armed Forces Minister, regarding US tariffs, says EU needs to react in the firmest manner possible as soon as possible.
• Austrian Coalition Government programme says we seek to avoid an EU excessive deficit procedure by achieving savings of more than EUR 6.3bln this year and EUR 8.7bln next year.

Nvidia

• Q4 revenue topped estimates, as Data Centre revenue surged, driven by AI chip demand, though the rate of expansion is slowing. And while Q1 sales guidance was above expectations, gross margins are seen easing in Q1, leading to shares slipping about 1.5% by the end of the extended trading session, with investors left slightly underwhelmed, according to Bloomberg.
• Q4 adj. EPS 0.89 (exp. 0.83), Q4 revenue USD 39.33bln (exp. 37.61bln). Q4 Data Centre revenue +93% Y/Y at USD 35.6bln (exp. 34.09bln); Q4 Gaming revenue -14% Y/Y to USD 2.5bln (exp. 3.02bln); Q4 Professional Visualization revenue +10% Y/Y at USD 511mln (exp. 507.6mln); Q4 Automotive revenue USD 570mln (exp. 460.7mln). Q4 R&D expenses +51% y/y to USD 3.71bln (exp. 3.75bln); Q4 adj. operating expenses +53% Y/Y at USD 3.38bln (exp. 3.4bln), Q4 FCF +38% Y/Y at USD 15.52bln.
• Exec noted that it successfully ramped up Blackwell production massively, and it has been the fastest product ramp in the company’s history; it delivered USD 11bln of Blackwell architecture revenue in Q4. Sees Q1 revenue around USD 43bln +/-2% (exp. 41.56bln), sees Q1 adj. GM at 71% +/- 50bps. Sees Q1 adj. gross margin of 73.5% (exp. 73.5%); gross margins are expected to rebound into the mid-70 later in the FY, being weighed at present by the ramp in Blackwell production.
• CFO said that it expects China shipments to maintain current levels as a percentage of data centre revenue, while Stargate data centres will use Spectrum X ethernet networking; anticipates that its networking unit will resume growth in Q1.
• CEO Huang said that next-gen AI requires 100 times more compute due to advanced reasoning processes, and also noted Nvidia’s China revenue halved due to export controls and competition

FX

• DXY is a touch higher and attempting to continue its recovery after printing a YTD low on Monday at 106.12 following a recent run of soft economic releases, which have weighed on US yields. On the trade front, US Commerce Secretary Lutnick clarified that if President Trump is satisfied by the March 4th deadline; but global tariffs will still come into effect on April 2nd. Today’s docket sees the 2nd release of US GDP, quarterly PCE metrics, durable goods and a busy Fed speaker slate.
• EUR is marginally softer vs. the USD after failing to hold above the 1.05 mark. On Wednesday, EUR/USD was able to match the recent YTD peak at 1.0528 before being dragged lower amid tariff headwinds after US President Trump said he will be announcing tariffs on the EU very soon and noted that EU tariffs are to be 25% on autos and other things. On the ECB, today’s account of the January meeting will likely pass with little in the way of fanfare given how stale the release will be viewed by the market. Flash CPI data for Spain leaned marginally hawkish.
• USD/JPY is currently staging somewhat of a bounce after a recent run of losses that have been triggered by softness in US yields; the relatively higher yield environment today is likely playing a factor for today’s upside. USD/JPY has ventured as high as 149.96 ahead of 150.00.
• GBP is flat vs. USD and EUR in a week that has been lacking in fresh macro drivers for the UK aside from a pledge to ramp up UK defence spending. Today’s docket has UK PM Starmer holding a press conference with US President Trump at 14:00EST/19:00GMT. However, this is not expected to be much of a market mover. Cable currently sits towards the bottom of yesterday’s 1.2634-1.2715 range.
• Antipodeans are both gradually declined during APAC hours to their weakest level in almost two weeks amid the flimsy risk environment, while there were muted reactions to the mixed New Zealand business survey and mostly weaker Australian capex data.
• PBoC set USD/CNY mid-point at 7.1740 vs exp. 7.2561 (prev. 7.1732).

Fixed Income

• USTs are softer, given the constructive US risk tone as NVIDIA results weren’t the near 10% move that options had been implying, though of course it remains to be seen how they will open in today’s session; with tariffs and energy strength also influencing. As it stands, USTs are at the bottom of a 110-14 to 110-26 band. While softer, the benchmark remains comfortably clear of yesterday’s 110-08 base. Ahead, a slew of Fed speak and Q4 GDP & PCE second readings and weekly claims are due.
• Bunds initially held just in the green but has seemingly succumbed to intensifying energy upside in the European morning. Action at the start of the session was, once again, driven by the tariff updates from Trump and remarks from EU officials/member nations on retaliatory measures; which sparked conflicting leads for EGBs given the potential growth headwinds and inflation tailwinds from such measures. As such, Bunds find themselves at the lower-end of a 132.54-132.96 band and now in the red by a handful of ticks. ECB Minutes due later.
• Gilts opened essentially unchanged but have also succumbed to intensifying energy action; currently trade at the low-end of a modest 92.99-93.33 band. Traders await the meeting between Trump and UK PM Starmer (19:00 GMT) today for any signs of a deal or exemptions from some or all of the touted measures. Supply from the UK was robust enough, though the sub-3x cover may have disappointed some, in the first conventional auction for the 2040 line after two well-received syndications.
• UK sells GBP 3.25bln 4.375% 2040 Gilt: b/c 2.89x, tail 0.6bps, average yield 4.836%.
• Italy sells EUR 6.75bln vs exp. EUR 5.75-6.75bln 2.95% 2030, 3.65% 2035 BTP & EUR 2.75bln vs exp. 2.5-2.75bln 2033 CCTeu.

Commodities

• Crude is on a firmer footing, paring back some of the pressure seen in the prior session after mixed inventories data. Newsflow in the European morning has been light with attention on tariff rhetoric after US President Trump’s commentary on Wednesday in which he noted they will be announcing tariffs on the EU very soon. Brent May in a USD 72.10-72.80/bbl range at the time of writing.
• Subdued sentiment was seen in precious metals and as spot gold trickled lower amid a firmer dollar and eventually dipped under yesterday’s trough beneath the USD 2,900/oz level. Spot gold resides in a current USD 2,877.17-2,920.81/oz range after dipping under support at 2,890.86/oz.
• Base metals trade mixed amid the tentative mood across markets and with upside capped by tariff rhetoric. Overnight action saw copper futures subdued after wiping out this week’s gains. 3M LME copper resides in a USD 9,410.00-9,461.00/t range thus far after dipping sub-9,500/t yesterday.
• US Secretary of State Rubio said he is providing foreign policy guidance to revoke all Biden-era oil and gas licenses that have funded Venezuela’s Maduro regime.
• Indian Mines Minister says they decided to explore lithium in Jammu and Kashmir, with clarity expected by May; looking at Congo and Tanzania for critical minerals.

Geopolitics: Middle East

• „Negotiations for the passage of the second phase will take place next week in Cairo or Doha”, according to Al Jazeera
• The bodies of four Israeli hostages have been transferred to Israel and a Hamas source stated that 97 Palestinian prisoners have been transferred to Egypt. Hamas also said it adheres to the Gaza ceasefire agreement and is ready for discussions on the second phase, while it added suggested the release of the remaining hostages depends on commitment to the ceasefire terms.

Geopolitics: Ukraine

• Russia’s Kremlin says they think the process with the US can move forward with political will, welcome the fact that US President Trump is „willing to listen”, no one expects quick and easy solutions with the US. No substantiative discussion yet on cooperation between Russian and US companies. Don’t want to see global trade wars. Everything needs to be resolved in stages. Focused on trade with the BRICS.
• European Council President Costa says member states must be prepared for a potential European contribution to the security guarantees for Ukraine and President Zelensky has been invited to the March 6th leaders summit.

US Event Calendar

• 08:30: Feb. Initial Jobless Claims, est. 221,000, prior 219,000
  • Feb. Continuing Claims, est. 1.87m, prior 1.87m
• 08:30: Jan. Durable Goods Orders, est. 2.0%, prior -2.2%
  • Jan. Durables-Less Transportation, est. 0.3%, prior 0.3%
  • Jan. Cap Goods Ship Nondef Ex Air, est. 0.3%, prior 0.5%
  • Jan. Cap Goods Orders Nondef Ex Air, est. 0.3%, prior 0.4%
• 08:30: 4Q GDP Annualized QoQ, est. 2.3%, prior 2.3%
  • 4Q Personal Consumption, est. 4.1%, prior 4.2%
  • 4Q GDP Price Index, est. 2.2%, prior 2.2%
  • 4Q Core PCE Price Index QoQ, est. 2.5%, prior 2.5%
• 10:00: Jan. Pending Home Sales (MoM), est. -0.9%, prior -5.5%
  • Jan. Pending Home Sales YoY, est. -1.1%, prior -2.9%
• 11:00: Feb. Kansas City Fed Manf. Activity, est. -4, prior -5

DB’s Jim Reid concludes the overnight wrap

As I rush off after this is published to get an emergency passport in deepest East London (see Tuesday’s EMR for why), this morning I’ve published a report on capex booms and busts through history, which you can read here. We’re currently in the midst of a once-in-a-generation private sector capex boom as AI mania sweeps the world, but these booms have recurred throughout economic history, often driven by transformative technologies or speculative fever. Our report looks into several historic case studies, from 18th century canal building and 19th century gold rushes and railway mania, to late 20th century real estate and tech bubbles – and compares their dynamics to the ongoing 2020s boom in AI. We then look at each boom’s characteristics, and why they saw a bust even though the underlying technology would prove transformative to the economy (as AI will likely be today). Interestingly, there are also capex booms that didn’t experience a bust phase, but these tended to be driven by public money. It was really interesting researching this piece, so I hope you will find it a fascinating context to the current AI boom.

With the capex boom in full force, Nvidia produced another impressive headline earnings report after the bell last night. But a modest beat, and nothing spectacular in terms of guidance, meant the report failed to live to the hype that has accompanied the chip giant’s earnings over the past two years. Indeed, it was the smallest revenue beat in two years ($39.3bn vs $38.25bn expected), so that was underwhelming for investors used to much bigger upside surprises. Looking forward, sales guidance for the current quarter ($43bn vs $42.3bn expected) was a little above the average estimate, and Nvidia were upbeat on the ramp up of new products, with its new Blackwell chip delivering $11bn of revenue last quarter and CEO Jensen Huang saying that “Demand for Blackwell is amazing”. However, their shares were down -1.5% by the end of after-market trading, and futures on the NASDAQ 100 are only pointing to a modest recovery, up just +0.18%. So this isn’t a release that’s created huge excitement.

Ahead of Nvidia’s results, markets had already witnessed a pretty mixed session. In Europe, the STOXX 600 (+0.99%) hit a fresh all-time high, but in the US session, more tariff comments from Trump meant the S&P 500 (+0.01%) pared back its initial gains, having been up as much as +0.92% at the intraday high. So that ended a run of 4 consecutive declines for the S&P, but it marked a 5th consecutive session where US equities had underperformed Europe. In turn, the risk-off tone supported a fresh rally for Treasuries, with the 10yr yield (-3.8bps) falling for a 6th consecutive session to 4.26%, the lowest since December 10.

Those tariff comments from Trump added to the uncertainty, as he proposed a potential 25% tariff against the EU. But it wasn’t clear if this meant a broad-based tariff or sector-specific ones, as Trump referred to “cars and all of the things”. There was also uncertainty about the date of Canadian and Mexican tariffs, which had been delayed by a month until March 4. Trump said “I’m not stopping the tariffs”, but then suggested they’d come into force on April 2, later than previously thought. However, a White House official subsequently said that March 4 remained the deadline for these tariffs and Trump hadn’t yet decided whether to grant another extension. So huge uncertainty.

Trump’s comments came shortly after the European close, which saw the S&P 500 pare back its early gains of nearly 1% to close flat on the day (+0.01%). The Magnificent 7 (-0.07%) did see a marginal decline, its fifth in a row, taking the index deeper into correction territory, having now shed -10.86% since its December peak. There were also some rather varied moves among them, with Nvidia up +3.67% before its results, whereas Tesla fell -3.96%, meaning it’s now down -39% from its December highs. Otherwise, there were some steadier gains elsewhere, with the NASDAQ (+0.26%) and the Russell 2000 (+0.19%) both moving slightly higher.

Earlier on, Europe had led a broad-based advance on both sides of the Atlantic. In particular, German equities continued their outperformance, with the DAX surging +1.71% to close just shy of its all-time high last week, whilst German mid-caps in the MDAX (+1.90%) hit an 18-month high. Meanwhile in Spain, the IBEX 35 (+1.64%) took its YTD gains to +14.98%, cementing this as its strongest start to a year since 1998. And over in Italy, the FTSE MIB (+1.32%) closed at a post-2007 high as well. However, Trump’s tariff comments have dented that momentum, with futures on the DAX down -0.74% this morning, while those on the Euro STOXX 50 are down -0.58%.

The risk-off tone meant rates rallied in response to Trump’s comments, with investors continuing to dial up their expectations for Fed cuts this year. The amount of rate cuts priced by the December rose +1.7bps on the day to 59bps, the most dovish path so far this year. In turn, that saw 2yr Treasury yields fall -2.3bps to a 4-month low of 4.07%, whilst the 10yr yield (-3.8bps) fell to 4.26%. Bear in mind it was only on Monday that 10yr Treasuries were trading at 4.45%, and over the last six sessions, the -29bps move has marked the sharpest decline since the turmoil last August. The outperformance at the longer-end was helped by a solid 7yr auction, with $44bn of bonds issued -0.9bps below the pre-sale yield. And overnight, 10yr yields have only come back a small amount, up +2.2bps to 4.28%.

Meanwhile on Ukraine, US President Trump confirmed that Ukrainian President Zelenskiy would be visiting the US tomorrow. That comes as the US and Ukraine have a draft agreement over Ukraine’s minerals, although Zelenskiy said yesterday that he needed more time to look at the deal. Nevertheless, Ukraine’s dollar bonds saw a strong rally against this backdrop, with the 10yr yield down -30.bps on the day. And that sovereign bond rally happened right across Europe, with yields on 10yr bunds (-2.4bps), OATs (-4.6bps) and BTPs (-4.3bps) all moving lower.

Overnight in Asia, most equity markets are drifting lower this morning after the weakness into the US close last night. Currently, the KOSPI (-0.97%) has seen the largest declines, followed by the Hang Seng (-0.82%), the Shanghai Comp (-0.50%) and the CSI 300 (-0.40%). However, there have been some gains, with Japan’s Nikkei posting a modest +0.14% advance, whilst Australia’s S&P/ASX 200 is also up +0.33%. And looking forward, futures on the S&P 500 (+0.22%) are pointing to further gains as well.

To the day ahead now, and US data releases include the weekly initial jobless claims, pending home sales for January, preliminary durable goods orders for January, and the second estimate of Q4 GDP. From central banks, we’ll get the ECB’s account of their January meeting, and hear from the Fed’s Barkin, Schmid, Barr, Bowman, Hammack and Harker.