(Bloomberg) -- Shares of the world’s largest technology companies climbed in late hours on speculation that Nvidia Corp.’s earnings will help reignite the artificial intelligence-driven rally.
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A $330 billion exchange-traded fund tracking the Nasdaq 100 (QQQ) rose after the close of regular trading. The giant chipmaker that’s seen as a barometer for AI gave an upbeat view of its highly anticipated Blackwell lineup, helping reassure investors after delivering good-but-not-great quarterly numbers. The shares climbed after whipsawing in the immediate aftermath of the results.
The company got $11 billion of revenue from Blackwell in the fourth quarter, something Nvidia described as the “fastest product ramp” in its history. The outlook comes at a shaky time for the AI industry, with investors concerned about whether data center operators will slow spending.
“Nvidia has swept aside concerns about production of its Blackwell chips, and threats to the boom in demand for computing power with top and bottom line beats for the fourth quarter, and guidance for the current quarter ahead of expectations,” said Derren Nathan at Hargreaves Lansdown.
In the run-up to Nvidia’s results, stocks churned as traders processed a barrage of statements from President Donald Trump on trade policy. Bonds climbed after a solid $44 billion auction of seven-year notes.
The S&P 500 was little changed. The Nasdaq 100 added 0.2%. The Dow Jones Industrial Average slid 0.4%.
The yield on 10-year Treasuries fell four basis points to 4.25%. The dollar rose 0.1%.
The dominance of big tech made life miserable for stock pickers in recent years. With the group reaching a double-digit drop from its peak, opportunities to uncover the next market vanguards have arisen, says Morgan Stanley’s Lisa Shalett.
Shalett sees “money to be made” in owning standouts within financial services, domestic industrials, energy and materials mining companies, as well as consumer services like media and entertainment. She also likes health care, one of last year’s worst laggards, pointing to interesting generative AI applications for the sector.
Stock pickers are holding their smallest allocations of megacap names since the global financial crisis, boosting their funds’ performance in a year that has kicked off with a slide in technology shares.
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That under-allocation is turning out to be a blessing in disguise. With the so-called Magnificent Seven faltering this year, active investors’ are seeing a performance boost: Roughly 49% of actively managed mutual funds and exchange-traded funds that compare themselves to the S&P 500 are beating the index in 2025, according to Morningstar Direct. That’s up from 38% during the same time last year and far above the 17% outperformance level of the last decade.
US stock gains are likely to continue broadening beyond the technology sector, according to Savita Subramanian at Bank of America Corp.
“There are a lot of attractive opportunities within the S&P 500 that may not be the Magnificent Seven,” the strategist told Bloomberg Television. “The theme is not necessarily ‘rest of world over US,’ but broadening trends outside of just mega cap tech.”
Corporate Highlights:
Salesforce Inc. gave a fiscal-year revenue forecast that fell short of estimates, dimming optimism that the company’s new artificial intelligence product would spur faster sales growth.
Snowflake Inc. projected better-than-expected revenue growth for the fiscal year, sending an optimistic signal about the adoption of its recently launched products for artificial intelligence. The shares jumped in extended trading.
Super Micro Computer Inc. soared after it submitted outstanding financial reports to become compliant with Nasdaq Inc. rules, easing concerns that the server maker would be delisted.
Two short sellers released reports on AppLovin Corp., touching off a record rout of as much as 23% before the shares pared losses.
AppLovin’s Chief Executive Officer, Adam Foroughi, said in a blog post that the reports “are littered with inaccuracies and false assertions.”
General Motors Co. plans to step up its program of buybacks by repurchasing $6 billion in shares and raising its dividend, rewarding investors by pushing more cash off its balance sheet.
Lowe’s Cos. forecast sales to rise this year, an early sign that consumers are starting to spend again after staying on the sidelines due to higher rates.
Chevron Corp. is interested in buying Phillips 66’s stake in a chemicals joint venture that activist Elliott Investment Management LP is pushing the oil refiner to exit, according to people familiar with the matter.
Off-price retailer TJX Cos. reported positive quarterly results, rebounding after its TJ Maxx and Marshalls brands saw softer-than-anticipated sales last quarter.
Key events this week:
Eurozone consumer confidence, Thursday
US GDP, durable goods, initial jobless claims, Thursday
Fed’s Jeff Schmid, Beth Hammack, Patrick Harker, Michael Barr, Michelle Bowman speak, Thursday
Japan Tokyo CPI, industrial production, retail sales, Friday
US PCE inflation, income and spending, Friday
Fed’s Austan Goolsbee speaks, Friday
Some of the main moves in markets:
Stocks
The S&P 500 was little changed as of 4 p.m. New York time
The Nasdaq 100 rose 0.2%
The Dow Jones Industrial Average fell 0.4%
The MSCI World Index rose 0.2%
Currencies
The Bloomberg Dollar Spot Index rose 0.1%
The euro fell 0.3% to $1.0487
The British pound was little changed at $1.2676
The Japanese yen was unchanged at 149.03 per dollar
Cryptocurrencies
Bitcoin fell 5.1% to $84,209.1
Ether fell 7.3% to $2,327.21
Bonds
The yield on 10-year Treasuries declined four basis points to 4.25%
Germany’s 10-year yield declined two basis points to 2.43%
Britain’s 10-year yield was little changed at 4.50%
Commodities
This story was produced with the assistance of Bloomberg Automation.
--With assistance from Lu Wang, John Viljoen, Emily Graffeo, Sujata Rao, Alice Gledhill and Winnie Hsu.
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