Nvidia has had the kind of week no chief executive wants, and its shares are bouncing anyway. After two days of heavy selling over the investigation into Jensen Huang, the world’s most valuable chipmaker is up around 4% before the open, CoreWeave is up about 14% after raising its outlook, and Nasdaq futures are leading Wall Street higher. The catch is that the bond market, the one place that punished Tuesday’s hot inflation report hardest, is shut for Veterans Day. US stocks open at 14:30 UK time with nobody in Treasuries to check whether the rally makes sense.
The situation right now
Nasdaq 100 futures are up about 1.9% near 28,356, S&P 500 futures are up about 0.8% near 7,607 and Dow futures are barely changed near 52,361. That split matters. This is a technology rebound rather than a broad rush back into risk, with the chip names doing nearly all of the lifting.
It follows a bruising Tuesday. October’s consumer price index rose 0.4% on the month against expectations of 0.3%, and core inflation, which strips out food and energy, rose 0.3% against 0.2%. The S&P 500 closed down 0.38% at 7,520.93, the Nasdaq Composite fell 0.74% and the Dow lost 0.30%, and those losses would have been bigger without a late recovery. The VIX, Wall Street’s gauge of expected volatility, has eased to about 18.6 this morning, down around 4.5%.
What has changed since this morning
When the Morning Market Brief went out, the chip rally was an Asian story. Taiwan’s market closed up about 3.6% and South Korea’s KOSPI rose about 2.6%, with memory makers leading. The question was whether that strength would survive the trip to New York after a hot inflation report. So far it has. US chip stocks are higher across the board before the open, and the gains have grown through the European session.
Europe has been steadier than spectacular. The FTSE 100 is up about 0.4% near 10,790, Germany’s DAX is up about 0.7% and the wider Stoxx 600 is up about 0.3%. The dollar has firmed and oil has climbed back above $92, both of which are worth keeping an eye on for anyone hoping the inflation scare fades quickly.
Nvidia’s scandal meets a buyer
The biggest US story is Nvidia, and it is not about chips. Shares fell 4.3% on Monday and 5.47% on Tuesday as more details emerged about Huang’s affair with an alleged Chinese spy. On Tuesday the company said it had hired the law firm Wachtell, Lipton, Rosen & Katz to investigate whether company secrets or national security had been compromised. This morning Morgan Stanley removed Nvidia from its list of top picks, noting the shares had dropped more than 25% since it added them in early October and calling Huang’s leadership crucial to the company’s direction.
Even so, buyers have turned up. Nvidia is trading around $175.60 in premarket dealing, up roughly 4% from Tuesday’s close near $168.89. Bank of America has set out three paths: a contained outcome with Huang staying in charge, a long period of uncertainty that weighs on the valuation before results, and an escalation involving adverse findings, leadership disruption or tighter export restrictions. Today’s bounce suggests investors are leaning towards the first, but that is a judgement made on very little new information. Nvidia reports quarterly results on 17 November, and the investigation is unlikely to be resolved by then.
Stocks moving before the open
CoreWeave is the cleanest piece of good news. The AI cloud provider, which rents out Nvidia-powered computing capacity, said third-quarter revenue jumped 168% to $3.7 billion and raised its full-year outlook to $13 billion to $13.3 billion of revenue, above the roughly $12.86 billion analysts had expected. That matters beyond one company. CoreWeave has become a lightning rod for worries about how the AI build-out is being financed, and a stronger outlook helps calm that fear. Its shares are up about 14% before the open, and fellow cloud providers Nebius and IREN have rallied with it.
The chip complex is moving as one. AMD and Micron are both up about 6%, Intel and Super Micro Computer are up about 6%, Taiwan Semiconductor’s US shares are up about 4.6% and Broadcom is up close to 4%. Oracle, another heavy spender on AI data centres, is up about 4.5%. Outside technology the picture is much quieter: Apple is slightly lower, JPMorgan is flat and Disney is down nearly 1%.
The dollar and currencies
The dollar index has risen about 0.3% to around 102.5, still digesting Tuesday’s inflation surprise and the growing chance that the Federal Reserve raises rates by more than a quarter-point in December. The pound has slipped about 0.2% to near $1.331 ahead of Thursday’s UK growth figures, the euro is down about 0.2% near $1.114 and the dollar is up against the yen at around 159.1. With the yen this close to 160, any further slide will draw attention in Tokyo.
A bond market on holiday
Treasuries are closed today, and that is the most unusual feature of this session. On Tuesday the two-year yield, which follows Fed expectations most closely, jumped about 18 basis points to roughly 4.74%, and the 10-year yield settled at about 5%, having traded above that level during the day. Those were big moves, and they are the reason stocks struggled.
Without a live Treasury market, equity traders lose their usual reality check. If the inflation scare were fading, falling yields would normally confirm it. Today there is no such signal, and lighter holiday trading can make moves in either direction look bigger than they really are. In the UK, the 10-year gilt yield is near 5.2%, slightly lower on the day.
Oil, gold and metals
Brent crude is up about 1.5% near $92.8 a barrel and US crude is up nearly 0.8% at about $86.7. The bounce follows a hard line from Iran over its nuclear material and fresh reports of tankers being damaged by mines, which keep the shipping risk alive even after oil’s slide from its October highs. For the inflation picture, that is unhelpful: cheaper energy was one of the few things working in the Fed’s favour.
Gold futures are up about 0.7% near $4,058 an ounce, recovering part of Tuesday’s sharp fall, while silver is up more than 3% and copper is up about 1%. A firmer dollar usually weighs on gold, so its resilience suggests some investors still want protection against the geopolitical risks in the Gulf.
What is left on the calendar
The US calendar is almost empty. There are no Federal Reserve speakers and no Treasury auctions today, and the Fed’s regular statistical releases have been pushed back to Thursday. CoreWeave chief executive Michael Intrator is due on CNBC at around 14:50 UK time, shortly after the open, which could keep the AI cloud trade in focus. Looking further ahead, Thursday brings UK growth data, Friday brings US producer prices, and Nvidia’s results on 17 November are the event the whole technology sector is now waiting for.
Levels worth watching
For the S&P 500, Tuesday’s close at 7,520.93 is the first reference. A cash open around 7,600 that holds would suggest the inflation scare is being absorbed, while a slide back towards Tuesday’s close would show the bounce had little behind it. For Nasdaq 100 futures, 28,000 is the round number to watch. Nvidia’s Tuesday close near $169 is the line that separates a genuine rebound from a brief relief move. In other markets, the dollar index around 102.5, the pound near $1.33, Brent between $90 and $93 and gold around $4,000 are the useful markers. These are references for context, not targets.
How we see it
The bias going into the open is cautiously positive for technology but unconvinced about the wider market. The evidence for the bulls is real: CoreWeave’s numbers ease worries about AI financing, Asian chip stocks rallied hard overnight and Nvidia is finding buyers despite the headlines. The evidence against is just as real. Tuesday’s inflation data made a December rate rise look close to certain and raised the chance of a bigger one, the dollar is firmer, oil is climbing again and the Nvidia investigation could produce bad news at any moment.
The opportunity, if the rebound holds, is in the stocks that were sold hardest on AI fears. The risk is that this is a thin holiday rally with no bond market to test it, and that it unwinds once Treasuries reopen on Thursday and yields resume their climb. Nvidia falling back below Tuesday’s close, or Nasdaq futures giving up the 28,000 area, would challenge the positive case. The markets to watch are Nvidia, CoreWeave, Nasdaq futures, the dollar against the yen and Brent crude.
For beginners, the takeaway is that a rally on a day when a major market is closed deserves a little extra scepticism, because one of the usual signals is missing. If you want to see how you would approach a day like this, the Samuel & Co Trading assessment is a good place to start.
