Stock Markets Hit Record Highs on Powell's Optimism
The US stock market notched record highs on Wednesday, buoyed by comments from Federal Reserve Chairman Jerome Powell that the economy is in "remarkably good shape". The tech-heavy Nasdaq Composite index closed up 1.3% at 19,735.12, while cloud and e-commerce company Amazon hit intraday all-time highs. iPhone maker Apple also reached new heights, with chipmaker Nvidia trading near previous highs after a 3.5% gain.
Nvidia's Partnership with TSMC
Reuters reported that Nvidia was in discussions with Taiwan Semiconductor Manufacturing Co (TSM) for its AI Blackwell chips to be produced at TSM's new plant in Arizona. Sources said that TSM had already begun preparing for production early next year, which could potentially boost the company's stock further. However, a spokesperson from Nvidia declined to comment on the matter.
Coinbase and Bitcoin Surge
Shares in cryptocurrency exchange platform Coinbase surged 7% in Wednesday's session, reaching more than 3% higher in pre-market trading on Thursday. This came after bitcoin topped the $100,000 mark for the first time late on Wednesday, with a current price of $102,791.91. The digital token has nearly doubled over the past month, buoyed by institutional interest and regulatory shifts that are adding legitimacy to cryptocurrencies.
Matt Britzman's Analysis
According to Matt Britzman, senior equity analyst at Hargreaves Lansdown, "While questions linger over Bitcoin’s role as a reliable store of value, its speculative allure and the pace of crypto innovation are becoming hard to ignore." He added that institutional interest and regulatory shifts are turning what once seemed like a fringe asset into a force reshaping finance. Love it or doubt it, bitcoin's climb is rewriting the rulebook for digital assets.
Shell and Equinor Combine Offshore Assets
FTSE 100-listed Shell and Norwegian state-owned energy company Equinor announced on Thursday that they were combining their UK offshore oil and gas assets to form a new company. The deal will create the UK North Sea's biggest independent producer, with both firms owning 50% of the new company. Completion is expected by the end of 2025.
Dan Coatsworth's Analysis
According to Dan Coatsworth, investment analyst at AJ Bell, "The big oil companies have been managing their gradual exit from the UK North Sea for years — the substantial discoveries having already been made and production in decline." He added that Shell's tie-up with Equinor should be seen in this context but will likely face complications.
Vodafone Gets Green Light
The UK's competition watchdog announced on Thursday that it had given the green light to the merger of telecoms companies Vodafone and Three. The deal, worth £16.5bn, will create the UK's biggest mobile network. However, according to Coatsworth, "These include the need to invest heavily in the UK’s 5G network and cap tariffs for three years."
Frasers Group Warns of Lower Profits
Shares in Mike Ashley's Frasers Group slid 13% on Thursday morning after the company warned that profits would be lower for the year. The retail group posted an 8% fall in revenue to £2.54bn ($3.23bn) in the first half, with adjusted profit before tax down by 1.5%. The company also expects to incur at least £50m of incremental costs going into FY26.
Derren Nathan's Analysis
According to Derren Nathan, head of equity research at Hargreaves Lansdown, "Investors will be hoping that the revised outlook will be enough to capture any further jitters over the vital Christmas trading period." He added that despite the downgrade, profits are still expected to be in growth territory this year.
Other Companies in the News
Other companies in the news on Thursday 5 December include:
- Future (FUTR.L)
- DS Smith (SMDS.L)
- Watches of Switzerland (WOSG.L)
- SDI (SDI.L)
- HP Enterprises (HPE)
- Brown-Forman (BF-B)
- Dollar General (DG)
Conclusion
The US stock market hit record highs on Wednesday, driven by comments from Federal Reserve Chairman Jerome Powell and a surge in cryptocurrency prices. However, concerns over profitability and regulatory changes will continue to affect companies like Frasers Group and Vodafone. As the year comes to a close, investors will be watching closely for any further developments that could impact stock markets worldwide.