Morning Bid: Nvidia vigil

By Mike Dolan

May 20 (Reuters) - What matters successful U.S. and planetary markets today

By Mike Dolan, Editor-at-Large, Finance and Markets

With Nvidia’s first-quarter results owed aft Wednesday's bell, traders are braced for large banal movements, with options markets pricing successful a 6.5% plaything successful ‌either direction.

That isn’t historically large successful percent terms, but it’s equivalent to astir $350 cardinal successful marketplace headdress - much than the combined worth ‌of 90% of S&P 500 firms.

I’ll get into that and much below.

But first, cheque retired my latest file connected the nexus betwixt the AI roar and rising enslaved yields.

And perceive to ​the latest occurrence of the Morning Bid regular podcast. Subscribe to perceive Reuters journalists sermon the biggest quality successful markets and concern 7 days a week.

NVIDIA VIGIL

The soaring AI capex outlays already outlined passim the existent net play marque it hard to beryllium downbeat astir what Nvidia’s results mightiness reveal. As ever, though, the barroom volition beryllium sky-high for the AI elephantine to conscionable already pumped-up expectations, which person helped assistance its banal different 18% oregon truthful this year.

It hasn’t ‌all been creaseless sailing for spot stocks, with ⁠South Korea’s Samsung slipping implicit 1% connected Wednesday arsenic its national said it would spell up with an 18-day onslaught from Thursday. The broader KOSPI scale fell by 1.7%, portion Japan’s Nikkei was down 1.5%.

Meantime, Wall Street indexes fell backmost ⁠again connected Tuesday connected renewed enslaved stress, arsenic 30-year Treasury yields spiked erstwhile much to interaction their highest level since 2007. 10-year yields besides rose, hitting their highest level of Donald Trump’s 2nd word truthful far.

A 20-year enslaved auction aboriginal contiguous volition beryllium watched closely, arsenic volition the merchandise of the minutes from the Fed’s ​April ​policy meeting. The minutes whitethorn shed much airy connected 3 policymakers’ dissent implicit an ​apparent “easing bias” successful the past Fed statement.

Fed futures are astir ‌80% priced for a complaint hike this twelvemonth arsenic the Iran warfare stalemate continues and still-elevated lipid prices stoke inflation. With Trump nominee Kevin Warsh acceptable to instrumentality the reins astatine the Fed soon, the president has changed his tune connected demanding contiguous complaint cuts, telling the Washington Examiner he’ll fto Warsh “do what helium wants to do”.

Brent crude continues to commercialized astatine good implicit $100 per barrel, but dipped backmost beneath $110/bbl connected Wednesday greeting aft President Trump again talked up prospects for an extremity to the Iran conflict. He balanced that, however, with much threats of subject enactment if a bid woody isn't ‌reached.

Elsewhere successful geopolitics, talks betwixt Chinese President Xi Jinping and Russian President Vladimir Putin ​got underway successful Beijing, with imaginable coordination connected vigor coming into focus.