Volkswacht Bodensee - Stocks waver after Nvidia-induced record rally

Frankfurt, London and Paris turned flat and most Asian shares climbed, following a day of record highs in Japanese, US and eurozone markets.

Oil prices however sank on demand fears after Federal Reserve policymakers appeared to commit the US central bank to higher-for-longer interest rates.

And the price of natural gas in Europe fell to a near three-year low, dampening inflation fears, as mild winter weather continues and stockpiles hold up.

- AI bandwagon -

"The focus of financial markets in the last 48 hours has been Nvidia's earnings report and its upbeat commentary about the future take-up of AI," said XTB analyst Kathleen Brooks.

"Nvidia's market capitalisation gained $277 billion on Thursday alone, the biggest one day increase in market cap ever."

Markets celebrated Thursday as Nvidia helped boost Tokyo's benchmark index past a record high set in 1989, and the euphoria spilled over onto Wall Street.

The tech-heavy Nasdaq powered up three percent, while both the Dow and S&P 500 ended at fresh records. The blue-chip index lodged its first close above 39,000 points.

"The emergence of AI as a huge new source of investment and growth has come at a particularly advantageous time, enabling a continued push into record highs despite an unwelcome environment of tight monetary policy in the face of global inflationary pressures," added Scope Markets analyst Joshua Mahony.

In New York, Nvidia shares surged 16.4 percent on Thursday to lift its market value to almost $2 trillion, after reporting quarterly profits hit $12.3 billion on record high revenue.

"There are still investors who want to jump on the AI bandwagon, and they are doing this through Nvidia," added Brooks.

Other tech giants, including Facebook owner Meta, Amazon and Microsoft -- among Nvidia's largest customers -- also saw gains.

Investors meanwhile digested the outlook for US interest rates.

On Thursday, three Fed officials signalled interest rate cuts would more than likely come later this year, with one suggesting he wanted to see "at least another couple more months of inflation data" before deciding when to start lowering rates.

"Oil prices dipped... as the market absorbed the Fed's commitment to prolonging higher interest rates," noted ActivTrades analyst Ricardo Evangelista.

"The surprising resilience of the US economy, evident in the latest data, provides the Fed with greater leeway to sustain its restrictive monetary policy for an extended period.

"This dynamic constrains economic growth and suggests reduced future oil demand, contributing to the price decline."

Asian shares mostly rose Friday but Tokyo was closed for a public holiday, one day after the Nikkei 225's record finish.

- Key figures around 1140 GMT -

London - FTSE 100: FLAT at 7,680.01 points

Frankfurt - DAX: FLAT at 17,363.83

Paris - CAC 40: UP 0.4 percent at 7,939.74

EURO STOXX 50: UP 0.2 percent at 4,862.77

Tokyo - Nikkei 225: Closed for holiday

Hong Kong - Hang Seng Index: DOWN 0.1 percent at 16,725.86

Shanghai - Composite: UP 0.6 percent at 3,004.88

New York - Dow: UP 1.2 percent at 39,069.11 (close)

Euro/dollar: DOWN at $1.0821 from $1.0823 on Thursday

Dollar/yen: UP at 150.75 yen from 150.53 yen

Pound/dollar: UP at $1.2664 from $1.2660

Euro/pound: DOWN at 85.46 pence from 85.48 pence

West Texas Intermediate: DOWN 1.3 percent at $77.58 per barrel

Brent North Sea Crude: DOWN 1.2 percent at $82.68 per barrel

burs-rfj/rl

T.Egger--VB