Asian stocks set to gain as oil extends losses; Nvidia earnings in focus

Asian stocks were poised for a positive turn on Wednesday, Aug 26, as falling oil prices eased inflation concerns and drove bond yields lower, according to the source. Traders were eagerly anticipating Nvidia's earnings, which could provide fresh insights into the outlook for artificial intelligence.

Equity-index futures for Japan, South Korea, and Australia had risen following a rebound in chipmakers, breaking Nvidia's seven-day losing streak and paving the way for its results on Aug 26. Prior to the earnings release, the Nasdaq 100 Index had closed 0.6% higher, while the S&P 500 Index had climbed 0.3%.

US crude oil prices had continued their decline, trading near US$81 a barrel, following Iran and Oman's discussions on an interim framework to resume shipping through the Strait of Hormuz. This decline in oil prices had helped lower 10-year Treasury yields by seven basis points to 4.63% on Tuesday, while the US dollar's strength had weakened.

Several key events were expected to shape trading this week, including Nvidia's earnings report on Aug 26, the release of the US Personal Consumption Expenditures gauge on the same day, and Federal Reserve Chair Kevin Warsh's speech at the Jackson Hole symposium on Friday. Analyst Kyle Rodda from Capital.com noted that while there was still some risk in the market due to persistent inflation and elevated yields, the easing of geopolitical risks and lower oil prices had helped alleviate some of the trepidation.

In other market developments, the Canadian dollar remained steady after Canadian Prime Minister Mark Carney matched new tariffs imposed by US President Donald Trump and announced support for businesses affected by the trade dispute. Meanwhile, US investors were closely monitoring Nvidia's earnings, which had recently faced pressure due to concerns about whether the billions invested in artificial intelligence would yield sufficient returns.

Analysts estimated that Nvidia's revenue had nearly doubled from the previous year to US$92 billion in the latest quarter, surpassing any other company's annual earnings. Nvidia's strong performance was seen as a key indicator of whether the AI boom could sustain the high expectations for technology valuations. Mark Malek from Siebert Financial believed that Nvidia was operating efficiently and expecting good results, though everyone was anticipating them.

The focus would then shift to the Federal Reserve's Jackson Hole Symposium, where Chair Kevin Warsh would deliver his first major speech. Investors would be looking for clearer guidance on his assessment of the US economy and the path for monetary policy. On Tuesday, consumer confidence had slipped to a seven-month low, as business conditions and the labor market concerns persisted. US personal consumption expenditures price index data, the Fed's preferred inflation gauge, was expected to be released on Wednesday.