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Nvidia shares soar, futures muted, Reddit IPO filing - what's moving markets

Published 02/23/2024, 04:24 PM
Updated 02/23/2024, 04:24 PM
© Reuters

Investing.com -- Nvidia shares soar following a blockbuster earnings release that added fuel to stock market euphoria around the applications of artificial intelligence. The rally pushes up the S&P 500 and Dow to fresh record closing highs, although futures on Friday point to a more subdued end to the trading week. Elsewhere, Reddit makes its filing for an initial public offering public.

1. Nvidia adds $277 billion in stock market value

Artificial intelligence chip designer Nvidia (NASDAQ:NVDA) added a staggering $277 billion in market capitalization on Thursday, setting a record for the biggest one-day jump in history.

The California-based firm's shares spiked by 16.4% to end the session at a fresh record high of $785.38, pushing up its market value to just under $2 trillion. The single-day addition in Nvidia's stock was itself bigger than the market cap of peer Advanced Micro Devices (NASDAQ:AMD) and eclipsed a $196 billion jump notched by Facebook-owner Meta Platforms (NASDAQ:META) earlier this month.

In total, $65 billion worth of Nvidia shares exchanged hands, making up about a fifth of all trading in S&P 500 stocks, Reuters reported.

Powering the frenzy was a 265% increase in fourth-quarter revenues at Nvidia, as well as commentary from Chief Executive Jensen Huang, who said that demand for AI is "surging worldwide across companies, industries, and nations."

2. Futures subdued

U.S. stock futures hovered around the flatline on Friday, pointing to a breather in the rally sparked by the bumper results from Nvidia.

By 03:00 ET (08:00 GMT), the Dow futures contract, S&P 500 futures, and Nasdaq 100 futures were all mostly unchanged.

The main averages on Wall Street -- as well as indices in Asia and Europe -- advanced on Thursday after Nvidia posted a massive spike in revenue and gave a bullish outlook for AI chip demand.

In New York, the blue-chip Dow Jones Industrial Average added 1.2% and the benchmark S&P 500 added 2.1%, with both ended at record closing highs. The tech-heavy Nasdaq Composite, meanwhile, rose by 3.0% -- its biggest single-session jump in a year and slightly under an all-time high closing level.

3. Reddit files for IPO

Reddit unveiled a narrowing loss as it filed its initial public offering documents with the Securities and Exchange Commission on Thursday ahead of a highly-anticipated debut on the New York Stock Exchange later this year.

The firm, which was founded in 2005 on the idea of creating "the home page of the internet," plans to trade on the New York Stock Exchange under the ticker symbol “RDDT.” Reddit is aiming to launch its IPO in March, according to recent media reports.

In the filing, Reddit said that the amount of shares sold to retail investors and users on the platform would be "significant," although it flagged that the participation could result in "increased volatility" of its market price. Typically, IPOs are mostly bought by institutional investors.

For the year ended Dec. 31, 2023, the social media company reported a loss of $1.54 a share from a loss of $2.77 a share a year earlier, as revenue, which is mainly driven by advertising sales, rose to $804M from $666M a year earlier.

4. StanChart reports 22% annual income jump

Asia-focused lender Standard Chartered (HK:2888) (LON:STAN_p) clocked a stronger profit for 2023 as it benefited from higher interest rates, with the bank also announcing a $1 billion buyback.

Still, the lender downgraded its income outlook for 2024 and forecast mild increases in its net interest income, citing some economic risks from sticky inflation and potential geopolitical instability.

StanChart’s underlying profit before tax for the year to Dec. 31 rose 22% to $5.68 billion, the group said in a statement to the Hong Kong Stock Exchange. Its underlying net interest income rose 20% to $9.56 billion for the year.

5. Oil prices dip

Oil prices were lower in European trade on Friday, and were set to close the week a shade lower as concerns over sluggish demand largely offset bets on tighter supplies linked to disruptions in the Middle East.

A string of weak economic readings from across the globe spurred more concerns over slowing demand, especially after data released last week showed the U.K. and Japan both entering recessions in the fourth quarter.

Expectations of higher-for-longer U.S. interest rates also weighed on the outlook for demand in the world's largest oil consumer, as several signals from the Federal Reserve showed the bank was in no hurry to begin trimming interest rates.

Brent oil futures expiring in April dipped 0.5% to $83.24 a barrel, while West Texas Intermediate crude futures fell 0.6% to $77.50 per barrel by 03:01 ET.

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