Nvidia Results Loom as Nasdaq Extends Three-Day Slide

Nvidia remained firmly in focus ahead of quarterly results due after the US close on Wednesday, with options markets implying a swing of roughly $350 billion in either direction for the stock. The Nasdaq and S&P 500 both fell for a third straight session on Tuesday as Treasury yields climbed to multi-month highs and oil prices stayed above $110 a barrel. The FTSE 100 edged slightly higher despite weakness in mining shares, while IG Group jumped strongly after upgrading revenue forecasts. The dollar held near a six-week high against major currencies, with sterling trading around $1.340.

Equities

The FTSE 100 closed 0.1% higher on Tuesday at 10,330.5 after giving up stronger early gains as government bond yields resumed their climb. The FTSE 250 fell 0.2% by the close. Investors reacted to signs of a softer UK labour market after April hiring and vacancy data pointed to weaker demand for staff, reducing expectations of an immediate Bank of England rate rise even as energy prices remained elevated.

IG Group closed 10.5% higher on Tuesday, making it one of the strongest performers in London trading, after the online trading platform raised both its annual and medium-term revenue forecasts for the second time this year. Mining shares weakened as metal prices fell, with precious metal miners dropping 3.7% and industrial metal miners down 2.7%.

Long-dated gilt yields moved higher again after briefly easing in the previous session, reflecting continuing concerns about inflation linked to tensions in the Middle East. Political uncertainty also remained in focus after Prime Minister Keir Starmer repeated his intention to remain Labour leader despite renewed criticism from some MPs.

In the US, the S&P 500 closed 0.67% lower on Tuesday, while the Nasdaq fell 0.84% and the Dow Jones Industrial Average lost 0.65%. The Nasdaq and S&P 500 both recorded a third consecutive daily decline as Treasury yields climbed sharply. The benchmark US 10-year Treasury yield rose to 4.687%, its highest level since January 2025, before easing slightly later in the session.

Technology shares came under pressure during afternoon trading. The S&P 500 software index closed 1.2% lower, while the Philadelphia Semiconductor Index recovered from earlier losses to finish marginally higher by 0.03%. Investors are now waiting for Nvidia’s quarterly earnings due after the close on Wednesday, with markets looking for further evidence that demand linked to artificial intelligence remains strong.

Akamai Technologies closed 6.3% lower on Tuesday after announcing a $2.6 billion convertible bond offering. Energy markets also remained in focus as Brent crude held above $110 a barrel despite slipping 0.73%, with traders monitoring developments in talks between the United States and Iran over the conflict in the Middle East.

Forex & Commodities

The US dollar held near a six-week high early on Wednesday as investors increased expectations for higher US interest rates later this year. The dollar index traded at 99.31, while the euro slipped to $1.160 and sterling held at $1.340, close to its weakest level in six weeks.

The Japanese yen remained under pressure, trading at 158.9 per dollar after briefly moving back towards the closely watched 160 level earlier this week. Traders remained alert to the possibility of further intervention by Japanese authorities after Tokyo stepped into currency markets several times in late April and early May.

Comments from US Treasury Secretary Scott Bessent added to expectations that the Bank of Japan could raise interest rates again next month. Bessent said he believed Bank of Japan governor Kazuo Ueda would act if given enough independence by the Japanese government.

The Australian dollar traded at $0.7105 on Wednesday morning, while the New Zealand dollar weakened to $0.5834. Emerging market currencies also remained under pressure, with the Indian rupee and Indonesian rupiah falling to record lows against the dollar.

Investors are now focused on the minutes from the Federal Reserve’s latest policy meeting due later on Wednesday. Markets are increasingly pricing in a US rate rise in December after several Federal Reserve officials warned in recent weeks that inflation remains too high.

US Treasury yields stayed elevated, with the 30-year Treasury yield rising to its highest level since 2007. Bond markets have reacted sharply to continuing inflation concerns linked to higher energy prices and disruption to oil shipments through the Strait of Hormuz.

Oil prices eased slightly in Asian trading on Wednesday after President Donald Trump said the conflict with Iran could end “very quickly”. Brent crude fell to $110.4 a barrel, while US WTI crude traded at $103.5.

Oil prices had already fallen late on Tuesday after US Vice President JD Vance said Washington and Tehran had made progress in talks aimed at avoiding further military action. Despite that, traders remain cautious as shipping through the Strait of Hormuz remains well below normal levels.

Citi said on Tuesday it expects Brent crude to rise towards $120 a barrel in the near term as supply disruption risks remain high. US crude inventories also continued to tighten, with industry data showing stockpiles fell for a fifth consecutive week last week.