Asian stock markets showed hesitation on Wednesday, with the MSCI Asia‑Pacific index outside Japan barely up 0.12% in early trade. The modest gain came amid a slide in oil prices and growing anticipation of Nvidia’s second‑quarter earnings, a key bellwether for the artificial‑intelligence industry.
Oil price dip tied to Hormuz negotiations
Brent crude futures dropped for a third consecutive day, falling more than 2% to $86.41 per barrel. The decline was driven by optimism that the critical Strait of Hormuz, which previously handled about one‑fifth of the world’s traded oil, could see increased shipments as Iran resumed talks with Oman. Iran has indicated the strait will stay closed until its conditions are met, but market participants are pricing in the possibility of an interim announcement.
The lower oil price helped push U.S. 10‑year Treasury yields down, with the benchmark yield slipping 6.5 basis points to 4.634%.
Nvidia earnings under the microscope
Investors turned cautious ahead of Nvidia’s earnings release later in the day. Analysts are focused on whether the AI spending boom can sustain profitability and meet lofty market expectations. Charu Chanana, chief investment strategist at Saxo in Singapore, noted that while beating expectations is now the norm for Nvidia, the size of the beat and the strength of guidance will be crucial for market reaction.
Options data suggest a smaller price move after the earnings report compared with previous quarters, indicating that Nvidia’s results may be becoming more predictable. Forecasts anticipate an 82.8% rise in third‑quarter sales to $104.20 billion, with adjusted gross margins staying around 75% for the second and third quarters.
J.P. Morgan analysts expect the earnings release to be “supportive of the AI trade though perhaps without giving a material near‑term boost” to the broader semiconductor sector.
U.S. dollar and inflation data in focus
The U.S. dollar held steady as traders awaited the latest U.S. inflation figures ahead of the Jackson Hole symposium. The dollar index was at 98.934, poised for a modest decline in August.
Meanwhile, the U.S. Treasury’s expanded debt‑buyback program aims to ease pressure on longer‑dated bond yields. Economist Kristina Clifton of Commonwealth Bank of Australia warned that while the program may lower overall interest costs, it does not address the underlying drivers of rising debt and concerns about fiscal dominance.
Investors are also watching the “debasement trade,” buying assets like gold and bitcoin as a hedge against potential currency erosion. Spot gold was priced at $4,646.08 per ounce, just below its recent three‑month high, and Bitcoin rose 0.6% to $78,704.
Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.
