NVIDIA, hailed by Goldman Sachs as the &#34;most important stock on Earth,&#34; released its earnings report after the U.S. stock market on Wednesday. Before the release of this heavyweight financial report testing the market's confidence in the AI boom, NVIDIA's stock price continued to fall, leading the decline of blue-chip technology stocks and dragging down the overall market.
The minutes of the Federal Reserve's January meeting released at midday showed that Fed officials were concerned about cutting interest rates too quickly and the risk of inflation stagnating. Journalist Nick Timiraos, known as the &#34;new Fed communication agency,&#34; later wrote that the minutes showed that most Fed officials were worried about cutting rates too early and the deep-rooted pressure on prices, rather than keeping high rates for too long, with only two pointing out the risks of long-term high rates.
After the release of the minutes, major U.S. stock indexes widened their losses, hitting daily lows, but the decline was not sustained. Subsequently, the losses narrowed and even turned into gains. Although the Nasdaq fell to its lowest closing level in nearly three weeks, the SPDR S&amp;P 500 and the Dow Jones Industrial Average staged a thrilling rebound in the final trading session. Some analysts said that the late rebound in U.S. stocks was driven by buying triggered by the fear of missing out (FOMO), with zero-day options (0DTE) funds also helping to push prices higher. After-hours, NVIDIA announced that its revenue for the last quarter and guidance for this quarter were both higher than expected. Following this news, NVIDIA rebounded after hours, driving up chip stocks and AI concept stocks across the board.
The rebound of U.S. stocks in the final trading session was partly due to zero-day options trading.
Demand for the 20-year U.S. Treasury bond auction completed by the U.S. Treasury on Wednesday was extremely weak, with the &#34;tail,&#34; which reflects demand, meaning the difference between the actual auction rate and the pre-issued rate, being the largest since the record of the 20-year bond auction, and the allocation to overseas investors hitting a new low in nearly three years. After the auction results were announced, U.S. bond prices fell further, yields rose, and the yield on the benchmark 10-year U.S. Treasury bond rose above 4.30%. Following the release of the Fed minutes, yields continued to rise, approaching the high set more than two months ago last week.
<h2>Nasdaq hits near three-week low, SPDR S&amp;P 500 and Dow Jones rebound in late trading, NVIDIA earnings drive chip and AI concept stocks higher after hours</h2>
The three major U.S. stock indexes opened lower for the second consecutive day and continued to decline. The Dow Jones Industrial Average fell more than 170 points, or over 0.4%, at the beginning of the session, narrowed to less than 14 points by the end of the morning session, and widened to over 100 points by midday. After the release of the Fed minutes at midday, the Nasdaq Composite Index fell more than 1.1%, the Dow fell over 220 points, and the SPDR S&amp;P 500 index fell nearly 0.6%, but rebounded from the lows in late trading, with the Nasdaq narrowing its losses and the SPDR S&amp;P 500 and Dow turning positive.
In the end, only the Nasdaq fell among the three major indexes, down by 0.23% to 15,580.87 points, marking a three-day decline and hitting a new low since February 1st. The SPDR S&amp;P 500 rose by 0.13% to 4,981.8 points, failing to approach the low point since the U.S. CPI data release on last Tuesday, February 5th. The Dow Jones Industrial Average rose by 48.44 points, or 0.13%, to 38,612.24 points, halting the two-day decline along with the SPDR S&amp;P 500.
The tech-heavy Nasdaq 100 index fell by 0.38%, marking a three-day decline and hitting a new low since February 1st for two consecutive days. The Nasdaq Technology Market Cap Weighted Index (NDXTMC), which measures the performance of tech stocks in the Nasdaq 100 index, dropped by over 1% intraday, closing down by 0.9% for a four-day decline to the low point since February 1st. The Russell 2000 index, which is dominated by value stocks, fell by 0.47%, hitting a new low since last Tuesday, February 13th.
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Major U.S. stock indexes hit daily lows after the release of the Fed meeting minutes at midday, but continued to rise about half an hour later. The SPDR S&amp;P 500 and Dow Jones both turned positive towards the end of the session.
Among the seven major tech stocks including Microsoft, Apple, NVIDIA, Alphabet, Amazon, Meta, and Tesla, there were mixed movements. Tesla surged by over 2.9% in the morning, then slightly declined at midday, closing up by 0.5%. After two consecutive days of decline, it did not fall further from the closing high since January 24th.
Among the six FAANMG tech giants, Microsoft, Meta (Facebook's parent company), and Netflix all fell by over 1% in the morning, closing down by nearly 0.2%, 0.7%, and 0.3% respectively. Microsoft saw a four-day decline, hitting a new low since January 31st for two consecutive days, while Meta and Netflix hit lows for three days in a row over the past week. Apple, which hit a low since January 5th after a six-day decline, turned negative at midday but closed up by 0.4%, after falling by over 1% in the morning. Amazon, which will be included in the Dow Jones components on February 26th, surged by over 1% in the morning and closed up by 0.9%. Alphabet, Google's parent company, rose by nearly 1.2%, continuing to move away from the low since January 8th that was refreshed last Friday.
Overall, chip stocks saw a four-day decline, with the decline narrowing towards the end of the session. The Philadelphia Semiconductor Index and the Semiconductor Industry ETF SOXX both fell by over 1% in the morning, closing down by over 0.2%, hitting a new low since February 7th. Among individual stocks, NVIDIA, which announced its earnings after Wednesday's session, fell by 4.6% at midday and closed down by nearly 2.9%, marking a four-day decline since hitting a new closing high last Wednesday, and hitting a low since February 2nd. After the earnings report was released, the stock price surged, with an after-hours increase of up to 9%. Intel, which fell by over 2%, rose by less than 1% after hours, while AMD, which fell by 0.8%, surged by over 4% after hours. Arm, which fell by over 4% in the morning, turned positive and closed up by over 1%, with an after-hours increase of about 6%.
After NVIDIA released its earnings report, its stock soared in after-hours trading, rising by as much as 9%.
Overall, AI concept stocks continued to decline, but rebounded after hours. Super Micro Computer (SMCI), a &#34;monster stock&#34; that has surged over 150% since the beginning of the year, saw a midday drop of up to 10%, closing down nearly 6.8%, but rose over 10% after hours. C3.ai (AI) closed down by 5.5% but rose over 5% after hours. SoundHound.ai (SOUN) closed down by over 9% but rose over 8% after hours. BigBear.ai (BBAI) closed down by nearly 3% but rose by almost 9% after hours. Palantir (PLTR) closed down by 0.6% but rose over 5% after hours. Adobe (ADBE) closed down by approximately 0.5% but rose in after-hours trading.
Chinese concept stocks rebounded overall. The Nasdaq Golden Dragon China Index (HXC) rose by over 2.2% in early trading, closing up nearly 1%, resuming its upward trend after a three-day halt following Tuesday's three consecutive gains. Chinese concept ETFs KWEB and CQQQ both closed up by over 1%. Among individual stocks, at the close, Li Auto rose by over 4%, Alibaba by over 3%, JD.com and Tencent by over 2%, Baidu, XPeng, and Bilibili by over 1%, Nio by nearly 0.2%, while Pinduoduo, NetEase, New Oriental, and Bitcoin mining giant Canaan all saw declines.
Among the stocks that released earnings reports, Palo Alto Networks (PANW), a cybersecurity company that lowered its full-year revenue and billing guidance, closed down by 28.4%; healthcare company Teladoc (TDOC) and solar stock Solaredge Technologies (SEDG) both fell by 23.7% and 12.2% respectively due to fourth-quarter revenue and first-quarter guidance missing expectations; Wingstop (WING), a chain restaurant with higher-than-expected fourth-quarter revenue but four consecutive quarters of decline, closed down by 4.4%; website building platform Wix.Com (WIX) rose by nearly 6% with revenue and profits exceeding expectations; luxury home builder Toll Brothers (TOL) rose by nearly 4% with quarterly profits surpassing expectations.
European stocks slowed down, with the pan-European index falling for two consecutive days after four straight gains. The STOXX 600 index continued to retreat from the closing high set on January 5, 2022. Most major European stock indexes rose, with the French stock market hitting a new closing high for five consecutive trading days, while the German stock market rebounded after two days of decline, and the Spanish and Italian stock markets rose for three and two consecutive days respectively. The UK stock market fell for two consecutive days after four consecutive gains.
In various sectors, banks fell by nearly 1.1%, driven by HSBC, the UK's largest bank, which plummeted by 8.4% after announcing a fourth-quarter loss of $150 million and a $3 billion write-down related to its stake in the Bank of Communications, marking its largest daily decline since April 2020. The mining sector, which led the decline on Monday and Tuesday, fell by 0.8% in the basic resources sector, with Rio Tinto falling by 1.5% due to a decline in annual profits, and Glencore falling by 1.1% due to dismal profits and a significant reduction in dividends, dragging down the UK stock market to the worst performance among European countries.
The healthcare sector fell by more than 0.7%, dropping from a ten-month high. Europe's highest market value pharmaceutical company, Novo Nordisk, fell by nearly 1.5%, continuing to move away from the closing record high set for five consecutive days until Monday.
After the release of the Federal Reserve meeting minutes, the yield on the 10-year US Treasury bond once approached a two-month high. The benchmark 10-year US Treasury bond yield fell below 4.25% during European stock trading, hitting a daily low and dropping nearly 3 basis points intraday. The US stock market erased its losses in early trading, turning higher. After the announcement of the sale results of the 20-year US Treasury bond at midday, it quickly rose above 4.30%. Following the release of the Federal Reserve meeting minutes, it briefly approached 4.33%, nearing the high of 4.33% reached on December 1, 2023, since last Tuesday. It rose by about 5 basis points intraday, closing at around 4.32% at the end of the bond market session, up more than 4 basis points intraday. After roughly flatlining on Tuesday, it resumed the rebound momentum from last Friday.
The 2-year US Treasury bond yield, which is more sensitive to interest rate prospects, fell below 4.58% during European stock trading, hitting a daily low. The US stock market turned higher in early trading. After the completion of the sale of the 20-year US Treasury bond at midday, it rose above 4.65%. Following the release of the Federal Reserve meeting minutes, it maintained its upward trend. It briefly reached 4.67% at the end of the session, still not close to the high of nearly 4.72% reached on the first day of the Federal Reserve interest rate meeting on December 13 last year. It closed at around 4.67% at the end of the bond market session, up by about 6 basis points intraday. After falling back on Tuesday, it rebounded.
The yields on various US Treasury bonds rose on Wednesday after the sale of the 20-year US Treasury bond and the release of the Federal Reserve meeting minutes, with the increase expanding.
After the release of the Federal Reserve meeting minutes, the US dollar index briefly rose, and the offshore RMB rose above 7.19 during the session, briefly falling by over 200 points.
The ICE US Dollar Index (DXY), which tracks the US dollar against a basket of six major currencies including the euro, fell below 104.00 in early Asian trading, hitting a daily low, approaching the intraday low near 103.80 set on February 9. It fell by over 0.1% intraday. Before the European stock market opened, it turned higher and briefly rose above 104.20 to hit a daily high, rising by over 0.1% intraday. It then turned lower several times, and after the release of the Federal Reserve meeting minutes at midday, it briefly rose before quickly returning to a downward trend, falling below 104.00 at the end of the session.
By the time the US stock market closed on Wednesday, the US dollar index was slightly below 104.00, falling by less than 0.1% intraday, continuing to approach the low set on February 7. The Bloomberg Dollar Spot Index, which tracks the US dollar against ten other currencies, fell slightly, marking a third consecutive day of decline.
In non-dollar currencies, the euro against the dollar rose above 1.0820 after the release of the Fed minutes, approaching the high near 1.0840 set on February 2, up 0.2% intraday; the pound against the dollar rose above 1.2640 after the Fed minutes were released, nearing the daily high set on Tuesday; the yen, which rebounded for two consecutive days, fell back, with the USD/JPY hitting 150.40 during midday trading, refreshing the daily high, and after the Fed minutes were released, the increase expanded, approaching the daily high, closing above 150.20 at the end of the trading day.
Offshore Renminbi (CNH) against the dollar hit a daily low of 7.2070 in the early Asian session, then quickly turned higher, rising to 7.1811 at one point in the Asian session, refreshing the intraday high since January 31, up 259 points from the daily low, but later continued to give back gains. The USD/CNH fell to 7.2020 during midday trading in the US stock market, dropping more than 200 points from the daily high. At 5:59 am Beijing time on February 22, the offshore Renminbi against the dollar was reported at 7.1994, up 23 points from the New York closing on Tuesday, rising for the sixth consecutive trading day.
Bitcoin (BTC) rose above $52,400 in the early Asian session, then retreated overall, with European stocks falling below $50,600 at one point, refreshing the daily low, dropping more than $1,000 from the daily high, a decline of over 3%, and closing above $51,000 at the end of the US stock market, down nearly 2% in the last 24 hours, falling from the high since December 2021 when it hit $53,000 on Tuesday.
<h2>Crude Oil Rebounds, Approaching Three-Month High</h2>
International crude oil futures turned higher during the trading session. When European stocks hit a daily low, US WTI crude oil fell to $76.32, down over 0.9% intraday, Brent crude oil fell to $81.66, down over 0.8% intraday. US stocks turned higher before the market opened, maintaining the upward trend. During midday trading, US oil rose to $78.08, up over 1.3% intraday, while Brent oil rose to $83.17, up 1% intraday.
In the end, crude oil rebounded on Tuesday. WTI April crude oil futures, which had stopped rising for two consecutive days, closed up 0.13% at $77.91 per barrel, approaching the closing high since November 6, 2023, set last Friday; Brent April crude oil futures closed up 0.84% at $83.03 per barrel, nearing the high since November 6, 2023, set during the three-day consecutive rise on Monday.
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<h2>London Copper Hits Three-Week High for Second Consecutive Rise, Gold Falls from Over One-Week High, Narrowing Decline after Fed Meeting Minutes</h2>
London base metal futures mostly rose on Wednesday. London copper and lead rose for two consecutive days, with copper closing above $8,500, hitting a new high since the end of January, and lead hitting a two-week high. Aluminum, which had fallen for four consecutive days, and nickel, which had fallen for two consecutive days, both rebounded, with aluminum rising from its low since late January and nickel hitting a new high since the end of December. Nickel, which fell on Tuesday, approached the high set over the past week on Monday. Tin fell for six consecutive trading days, hitting a new low in nearly two weeks.
In the Asian market session, New York gold futures hit a daily high of $2043.5, rising nearly 0.2% intraday. However, it later fluctuated multiple times and turned downward. The U.S. stock market also failed to rebound after an initial decline in the morning session. Following the release of the Congressional minutes at midday, gold futures briefly tested $2030.90, hitting a daily low and dropping over 0.4% intraday. The decline later narrowed, approaching $2038 and ending the day with a decrease of less than 0.1%.
At the close, COMEX April gold futures, which had risen for three consecutive trading days, fell by 0.27% to $2034.3 per ounce, falling from the high seen on Tuesday since February 8th.
Spot gold rose above $2032.30 in the pre-European stock market session, hitting a high for the second consecutive day since last Tuesday, February 13th. After the release of the Federal Reserve minutes, spot gold initially hit a daily low near $2020, gradually erasing the intraday losses.
<img src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/5b0bf974-bfcc-4433-959e-39dd6bafcfda.jpeg?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/5b0bf974-bfcc-4433-959e-39dd6bafcfda.jpeg"/> Spot gold hit a daily low after the release of the Federal Reserve minutes, but later recovered from the intraday decline.

NVDA

After the release of the Fed minutes, the US stock market hit a new daily low, with the Nasdaq hitting a near three-week low, while the S&P and Dow turned higher in the final moments of trading. Nvidia fell 2.9% before its earnings report, but chip stocks surged after the report, with AMD rising over 4% after hours despite a 0.8% decline in regular trading. AI "unicorn" Super Micro (SMCI) fell nearly 7% but rebounded over 10% after hours. Chinese concept stocks rebounded, closing up nearly 1%, with Li Auto up over 4% and Alibaba rising over 3%. French stocks hit a historic high for the fifth consecutive day, while HSBC fell over 8%. After the 20-year US bond auction, bond yields accelerated. Following the Fed minutes, the 10-year US bond yield approached a two-month high; the Invesco DB US Dollar Index TR Bullish Fund briefly rose before resuming its decline. Offshore RMB rose above 7.19 in intraday trading, hitting a three-week high before retreating over 200 points but closing slightly higher. Crude oil rebounded, nearing a three-month high. Gold fell from a more than one-week high, narrowing its losses after the Fed meeting minutes. London copper rose for the second consecutive day to a three-week high.

Tech giants continue to suppress, Nasdaq falls for the third consecutive day, S&P rebounds narrowly, and NVIDIA surged 9% after earnings report.