There aren't that many moments when you feel that an event can make or break the market. The publication of Nvidia's results and forecasts was one of them. The market is somewhat short of catalysts, having all but given up on seeing Western central banks cut their key rates before the summer. The artificial intelligence theme, which has been driving many equities for months, was slowing down. Not fundamentally, since something powerful is certainly happening with AI, but because things seem to be moving too fast in terms of the valuation of players in the sector. To top it all off, there aren't that many players, so they're concentrating investment.

Nvidia has a habit of releasing its results late. I don't know the historical reason for this, but it's a fact: earnings come two or three weeks after the other US tech giants. As a result, it stands alone at the time of its report, which gives its figures even more influence. This year, for example, Apple, Meta and Amazon published their results on the same evening, February 1, in the midst of dozens of other giants. On February 21, no one can overshadow Nvidia, no one can make up for slightly mediocre figures. Or no one can mitigate flamboyant results, as happened in the evening after the close of Wall Street.

Nvidia's results were expected to be great, but the market needed them to be mindblowing to keep the AI fever going. And the challenge was met. The growth envisaged and secured for the future is even higher than forecast by analysts who had already raised their expectations by leaps and bounds. At the same time, the group is generating considerable liquidity. The share price rose by 9% outside US trading hours after the announcements, the best possible indication of the market's reception. Futures on Wall Street were firmly in the green, with the Nasdaq 100 up 2%.

In other news, US initial jobless claims fell to 201,000 for the week ended February 17 from an upwardly revised 213,000 level in the previous week, while 216,000 was expected in the Bloomberg consensus. This highlights the resilience of the labor market, which is good for the US economy and stocks, but not so much for rate cuts prospects.

The minutes of the Fed meeting held on January 30 and 31 had little impact after their release yesterday. US bond yields rose slightly, reacting placidly to the Fed's continued firm stance on inflation. The central bank is still cautious about lowering interest rates prematurely. Swaps bookmakers are showing that the market is still mostly hoping for a first rate cut in June, with the probability of such a move slightly lower than before the minutes were released.

Elsewhere, the Nikkei 225 broke its 30-year high during the Japanese session. China is still in turmoil, this time with a measure designed to ban net sales at the opening and closing of the market for local institutional investors. Beijing may well end up banning Chinese equities from falling. Macroeconomic data returned, with the first draft of February PMI indicators for the major economies. The composite index for February stayed in contraction territory -below the threshold of 50 - but it improved more than the Reuters consensus. Germany is faring the worse among eurozone countries, while France is recovering. The UK is also recovering.

In Asia Pacific, the Nvidia effect is visible on the Nikkei 225, which gained 2.2% at the close. South Korea and Australia were much more measured, albeit in the green. India, on the other hand, lost 0.3%. As for China, the rebound continues with identical gains of 0.8% in Hong Kong and Shanghai at the end of the session. Leading indicators are bullish in Europe, with the Euro Stoxx 600 up 0.7%.

Today's economic highlights:

PMIs across the majors economies are on the agenda, along with the Chicago Fed's national activity index and new jobless claims, existing home sales and DOE crude inventories. The full agenda is here.

The dollar is stable at EUR 0.9234 and GBP 0.7913. The ounce of gold is steady at USD 2028. Oil is little changed, with North Sea Brent at USD 82.02 a barrel and US light crude WTI at USD 77.66. The yield on 10-year US debt has risen to 4.30%. Bitcoin is trading at USD 51,000.

In corporate news:

  • Synopsys forecast second-quarter sales and earnings ahead of Wall Street estimates on Wednesday, anticipating increased demand for its AI-enabled, complex chip design software.
  • Intel said Wednesday that MICROSOFT plans to use its custom chipmaking services, and that the group expects to overtake TSMC in advanced chipmaking by 2025.
  • Alphabet said on Thursday that it was pausing the generation of human images for its Gemini AI model, and would soon release an improved version.
  • Abbvie is looking to issue at least $13 billion in bonds to help finance its acquisitions of ImmunoGen and CEREVEL THERAPEUTICS, Bloomberg reported Wednesday.
  • Moderna reported a surprise fourth-quarter profit on Thursday, thanks to cost-cutting and deferred payments, and the vaccine maker is proposing a marketing timetable for its experimental respiratory syncytial virus vaccine. The stock gained 1.2% before the opening.
  • Cheniere Energy announced on Thursday a drop in annual sales for its liquefied natural gas activities, penalized by falling natural gas prices.
  • Rivian announced on Wednesday that it would reduce its workforce by 10% and that its production of electric vehicles this year would be well below estimates. The stock lost 14.4% before the opening.
  • Lucis forecast annual vehicle production below analysts' estimates on Wednesday, with demand for its luxury electric vehicles showing signs of slowing. The stock loses 8.4% before the opening.
  • Ansys beat Wall Street estimates for fourth-quarter sales and earnings on Wednesday, thanks to growing demand for its software solutions. The stock gained 2% after the close.
  • Royal Caribbean raised its annual profit forecast, benefiting from strong cruise demand.
  • Lyft is down 2.5% after the close, as the group seeks capital to refinance part of its debt. The group announced a $400 million private placement of convertible bonds maturing in 2029.
  • Marathon Oil beat Wall Street estimates for fourth-quarter earnings on Wednesday, as the US shale producer benefited from higher production.
  • APA - The shale oil producer missed Wall Street estimates for its fourth-quarter profit on Wednesday, as its North Sea production declined.
  • Mosaic - The fertilizer manufacturer posted lower fourth-quarter earnings on Wednesday, as lower fertilizer prices squeezed margins.

Analyst recommendations:

  • Capital One Financial Corporation: Evercore ISI downgrades to in-line from outperform with a price target reduced from USD 160 to USD 142. Edward Jones downgrades to hold from buy.
  • Datadog, Inc.: Baptista Research downgrades to hold from underperform with a price target raised from USD 99 to USD 148.50.
  • Doordash, Inc.: Morgan Stanley upgrades to overweight from equalwt with a price target raised from USD 135 to USD 145.
  • Globalfoundries, Inc.: Baptista Research downgrades to outperform from buy with a price target reduced from USD 79.20 to USD 64.40.
  • Howmet Aerospace Inc.: Baptista Research downgrades to underperform from hold with a price target raised from USD 57 to USD 64.40.
  • Martin Marietta Materials, Inc.: HSBC upgrades to hold from reduce with a price target raised from USD 376 to USD 543.
  • Moody's Corporation: Baptista Research downgrades to hold from underperform with a price target raised from USD 343 to USD 400.
  • Nvidia Corporation: Morningstar upgrades to hold from sell with a price target raised from USD 480 to USD 730.
  • Palo Alto Networks, Inc.: William O'Neil & Co Incorporated drops coverage on the stock.
  • The Mosaic Company: Scotiabank upgrades to sector outperform from sector perform with a target price of USD 40.
  • Trimble, Inc.: Baptista Research downgrades to hold from buy with a target price of USD 64.40.
  • Verisk Analytics, Inc.: Morningstar downgrades to hold from sell with a price target raised from USD 220 to USD 225.
  • Walmart Inc.: CTBC Securities Investment Service Co LTD upgrades to add from neutral with a price target raised from USD 160 to USD 195.
  • Zoetis Inc.: Baptista Research upgrades to outperform from hold with a price target raised from USD 203 to USD 219.
  • Bridgepoint Group Plc: Investec downgrades to hold from buy with a target price of GBX 272.
  • Mitchells & Butlers Plc: Shore Capital upgrades to buy from hold.
  • Group Plc: Berenberg upgrades to buy from hold with a price target raised from GBX 290 to GBX 295.
  • First Quantum Minerals Ltd.: Jefferies upgrades to buy from hold with a price target raised from CAD 13 to CAD 18.