Nvidia (NASDAQ:NVDA), the chip company that has become Wall Street’s most influential stock, continues to rise, helping U.S. indexes hover near record highs despite mixed economic reports. On Thursday, the S&P 500 increased by 0.1% in early trading, marking its 31st all-time high this year before the Wednesday holiday. The Dow Jones Industrial Average remained mostly unchanged, while the Nasdaq composite climbed by 0.2%. Nvidia shares rose by 3% after surpassing Microsoft as the most valuable company on Wall Street. Darden Restaurants also saw a 1.4% increase after reporting profits that slightly exceeded analysts’ expectations.
European Markets and Central Bank Decisions
European markets opened higher on Thursday, following a mixed day of thin trading in Asia due to the U.S. Juneteenth holiday. In London, the FTSE 100 gained 0.2% to reach 8,218.75, with investors focusing on an upcoming Bank of England policy rate decision. The central bank is expected to maintain its main interest rate at a 16-year high of 5.25%, despite data showing that British inflation hit the central bank’s 2% target in May for the first time in nearly three years.
Germany’s DAX increased by 0.6% to 18,180.98, and the CAC 40 in Paris also added 0.6% to reach 7,612.35. The Swiss National Bank lowered its main policy rate by a quarter of a percentage point, citing a reduction in “underlying inflationary pressure” despite rising costs in rents, tourism services, and oil products. The rate cut to 1.25% from 1.5% will take effect on Friday.
U.S. Market Futures and Asian Trading
Ahead of the reopening of U.S. markets, the futures for the Dow Jones Industrial Average showed little change, while the S&P 500 futures rose by 0.4%. In Asian trading, Tokyo’s Nikkei 225 index gained 0.2% to 38,633.02. However, Hong Kong’s Hang Seng index fell by 0.5% to 18,335.32, and the Hang Seng tech index retreated by 1.7% after a significant rise on Wednesday. The Shanghai Composite index dropped by 0.4% to 3,005.44.
The Chinese yuan hit its lowest level this year, with the central parity rate set at 7.1192 yuan to the U.S. dollar. This depreciation adds complexity to China’s monetary policy efforts aimed at stimulating the economy. The Chinese central bank kept its one-year lending benchmark rate at 3.45% and the five-year loan prime rate at 3.95% on Thursday.
Comments from the People’s Bank of China and Other Asian Markets
People’s Bank of China Governor Pan Gongsheng assured a financial forum in Shanghai that China would maintain accommodative monetary policies to support the economy. However, his comments, along with those from other Chinese officials about market reforms, had little effect on share prices.
In Sydney, the S&P/ASX 200 showed minimal change at 7,769.40, while South Korea’s Kospi increased by 0.4% to 2,807.63. Taiwan’s Taiex rose by 0.9%, but Bangkok’s SET fell by 0.5%.
Indonesia’s Central Bank and Commodity Prices
Indonesia’s central bank kept its benchmark rate steady at 6.25%. The weakening of Indonesia’s currency against the dollar has slowed the central bank’s rate-cutting measures, according to a report by S&P Global Market Intelligence.
In other dealings, U.S. benchmark crude oil fell by 12 cents to $80.59 per barrel in electronic trading on the New York Mercantile Exchange. Brent crude rose by 8 cents to $85.15 per barrel. The dollar strengthened to 158.42 Japanese yen from 158.10 yen, while the euro slipped to $1.0721 from $1.0745.
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