Fed minutes boost the dollar
Fed minutes showed officials still have faith that price pressures will ease in the coming months, but disinflation is likely to take longer than previously thought.
The Federal Reserve
The Federal Reserve (Fed) minutes boost the USD, Fed minutes showed officials still have faith that price pressures will ease in the coming months, but disinflation is likely to take longer than previously thought. Some asked whether the current level of interest rates was high enough to guarantee that outcome. The response for now was to maintain the benchmark rate in the current 5.25%–5.50% range, but the minutes released on Wednesday excluded specific reference to that notion and to the likelihood of rate cuts this year. The dollar strengthened at the announcement, while oil and metal prices traded lower.
Jibun Bank's manufacturing PMI
In Japan, Jibun Bank's manufacturing Purchasing managers' index (PMI) flash unexpectedly rose above 50 for the first time since May last year. Services PMI declined but remains comfortably in expansion. The market awaits similar data for most major countries. Eurozone manufacturing activity is still going through difficult times.
The UK manufacturing PMI
In the UK, manufacturing seems to be in a slightly better place and is expected to rise closer to the 50 level. In March, the index rose above 50 for the first time since July 2022, before falling below again in April.
The US manufacturing PMI
In the US, manufacturing PMI is forecast to remain at 50. PMI services in all countries are expected to remain in expansion territory.
NVIDIA
NVIDIA shares rose 5.5% in extended trading on Wednesday, hitting yet another record after posting better-than-expected results and forecasts. Excluding items, the company earned $6.12 per share in the first quarter, beating estimates of $5.58. Revenue rose 262% year-over-year to $26.04 billion, beating estimates of $24.65 billion.
Sales at the data center segment, its largest by revenue, grew 427% to $22.6 billion. Nvidia reported a first-quarter adjusted gross margin of 78.9%, beating estimates of 77%. To compare, competitor AMD recorded an adjusted margin of 52% in its fiscal first quarter. Nvidia expects the second-quarter adjusted gross margin to be 75.5%, plus or minus 50 basis points. Analysts on average forecast the gross margin to be 75.8%. Nvidia will split its stock ten-for-one, effective June 7. It is also raising its quarterly dividend by 150% to 1 cent per share on a post-split basis.
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