Markets Balance Nvidia Gains, Risks:

Image Source : Krish Capital Pty Ltd

Index Update:  The FTSE 100 index, a key benchmark index for the London stock exchange, went down around 0.45% on 28 August 2025.  

Macro Update:  British services firms saw another dip in confidence in August, with the CBI warning that high costs and weak demand are weighing on hiring, investment, and profits, while the BoE remains cautious on rate cuts amid inflation risks. Global bond markets signaled more volatility as Germany, Japan, and the U.S. prepare long-dated issuances, pushing yields to multi-year highs and raising debt servicing concerns. UK travel demand hit a record 81mn passengers in Q2, though Heathrow and Gatwick expansions face opposition, while car output was mixed with July production up 5.6% but overall vehicles down 10.8%. London equities edged lower on Fed independence concerns, and Barclays advanced restructuring by selling its Entercard stake to Swedbank for $273mn, releasing £900mn in risk-weighted assets. 

Top Market Movers:  Among top gainers on FTSE 100 index, Anglo American PLC (LSE: AAL) witnessed a rise of 2.73% followed by JD Sports Fashion PLC (LSE: JD.) which gained around 2.53%. 

Commodity Update:  The dollar slipped Thursday as traders priced in a possible Fed rate cut next month after New York Fed chief John Williams hinted at easing, while President Trump’s push to oust Fed Governor Lisa Cook added pressure. Gold rose 0.34% to $3,444.82, silver 0.49% to $38.883, and copper 0.38% to $9,800.05. Brent crude fell 0.33% to $66.99, weighed by softer U.S. fuel demand outlook and tariff-driven supply concerns. 

Our Stance:  The S&P 500 closed at a record high on Wednesday as markets awaited Nvidia’s quarterly earnings, seen as a key test of lofty AI-driven valuations with the company accounting for nearly 8% of the index. Nvidia reported strong results, with Q2 revenue rising 56% year-over-year to $46.74 billion and net income climbing 59% to $26.4 billion. However, a modest shortfall in data center revenue and the exclusion of H20 chip sales to China dampened sentiment, leading to a 3% after-hours decline in its shares. While broader market optimism remains, concerns over Nvidia’s China exposure, slowing data center momentum, and overheated valuations highlight the fragility of the AI rally. 

FTSE 100 

The FTSE 100 slipped 0.27% on Thursday to trade at 9,230.20, forming a bearish candlestick on the daily chart. Despite the pullback, the index remains firmly above a key horizontal support level, underscoring strong underlying momentum. Technical indicators continue to paint a constructive picture. The price is holding comfortably above both the 21-period and 50-period Simple Moving Averages (SMAs), which are acting as dynamic support and signaling sustained buying interest. Meanwhile, the Relative Strength Index (RSI) at 59.70 reflects strengthening momentum and points to a potential shift toward deeper bullish sentiment. A decisive breakout above the immediate resistance zone would confirm the prevailing uptrend and open the door to higher targets in the sessions ahead. On the downside, holding above current support remains critical to preserving the bullish structure, while a breakdown below the moving averages could trigger a near-term corrective phase.