Oil Prices Tumble 4%, Nvidia Earnings Loom as Copper Hits Record High

Market Overview

Global markets focused on several major themes on Wednesday.

First, easing tensions in the Middle East weighed heavily on oil prices. Reports of a breakthrough in U.S.-Iran talks over freedom of navigation through the Strait of Hormuz prompted crude to give back part of its recent gains. WTI crude fell 3.12% to $82.36 per barrel, while Brent crude dropped 3.89% to $88.58, briefly slipping below the $90 mark intraday.

Second, technology stocks rebounded, led by strength in semiconductor shares. The Philadelphia Semiconductor Index gained 1.4%, while the Nasdaq Composite rose 0.66% to 26,151. Nvidia climbed 2.2% and AMD surged 4.9%. Nvidia is scheduled to report earnings after the U.S. market close tonight, with consensus expectations calling for revenue of approximately $92 billion.

Third, Canada announced roughly $20 billion in retaliatory tariffs and raised tariffs on steel and aluminum to 50%, marking a sharp escalation in the U.S.-Canada trade dispute.

Precious and industrial metals also advanced. Spot gold rose 0.21% to $4,662 per ounce, extending its record-setting run, while copper futures in both London and New York climbed to fresh all-time highs.

At the same time, longer-dated U.S. Treasury yields moved lower, with the 10-year yield falling to 4.64%. U.S. consumer confidence declined to 89.4 in August, its lowest level in seven months.

Key Themes to Watch● Nvidia Earnings and AI Capital Spending

Nvidia is set to report earnings after the U.S. market close tonight, with the market expecting revenue of approximately $92 billion, nearly double the level from a year earlier.

The results are widely viewed as a critical test of the strength and sustainability of the current AI capital expenditure cycle. Investors will be watching closely to see whether data center demand remains robust and whether Nvidia raises its guidance for the coming quarter.

The outcome could have an immediate impact on risk appetite across semiconductor and broader technology stocks, making Nvidia's earnings the single most important cross-asset event of the week.

● Oil Prices and the Repricing of Middle East Risk

Reports of progress in U.S.-Iran negotiations over freedom of navigation through the Strait of Hormuz triggered a rapid unwinding of geopolitical risk premiums in crude markets, with Brent briefly falling below $90 per barrel.

However, European natural gas inventories remain relatively low, while uncertainty surrounding winter energy supplies has yet to disappear. Any setback in negotiations or renewed disruption to Red Sea shipping could limit further downside in crude prices.

Oil markets may therefore need to establish a new equilibrium between expectations for geopolitical de-escalation and underlying physical supply-and-demand fundamentals.

Key Events and Developments

• Nvidia earnings: Due after the U.S. market close tonight. Consensus forecasts call for approximately $92 billion in revenue, nearly double the year-earlier level.

• U.S. Core PCE Price Index for July: Due Friday. The market expects 3.3% year-over-year and 0.2% month-over-month growth.

• Jackson Hole Symposium: Friday's remarks will be closely watched for signals on the monetary policy path and the outlook for interest rates.

• Escalating U.S.-Canada trade tensions: Canada has announced approximately $20 billion in retaliatory measures, while higher steel and aluminum tariffs could ripple through North American supply chains.

• Oil prices and U.S.-Iran negotiations: Brent briefly fell below $90 per barrel, with markets closely monitoring further developments regarding freedom of navigation through the Strait of Hormuz.

• Chinese corporate developments: Alibaba executives have collectively increased their holdings by more than HK$800 million, while Nongfu Spring reported a 16% increase in first-half revenue.