Wall Street cautious before Nvidia results, Fed minutes

In the eurozone, the Frankfurt and Paris stock markets edged higher, with the CAC 40 in Paris setting new intraday and closing highs.

Hong Kong and Shanghai markets jumped after Beijing's latest measures to boost China's stuttering economy, but Wall Street declines Tuesday weighed on other Asian indices.

World oil prices rose and the dollar climbed against the yen but slid against the euro and pound.

"Markets remained skittish ahead of two major events that could have a significant influence over the direction of equities in the coming weeks," said Danni Hewson, head of financial analysis at stockbroker AJ Bell.

She added that the Fed minutes and Nvidia results "have the power to move the dial for investor sentiment".

On Thursday meanwhile, the European Central Bank publishes minutes from its most recent meeting on eurozone monetary policy.

The Fed and ECB releases will be closely examined for clues on when the pair could start cutting interest rates as inflation cools.

On the corporate front, traders are looking to see if Nvidia can meet high growth expectations thanks to fast uptake of artificial intelligence.

Briefing.com analyst Patrick O'Hare pointed to disappointing guidance from Palo Alto Networks, another company that has profited from the rally in tech stocks, which sent its share price down by more than 25 percent at the start of trading.

- 'Decisive point' for tech rally? -
"The stock has been a star performer for some time, but failing to live up to the high growth expectations has created some nervous energy in front of Nvidia's earnings report after the close," O'Hare said.

"There is a lot of bullish sentiment (and hefty gains) wrapped up in Nvidia's stock, so the market's reaction to the report will be just as important as what the AI leader reports," he added in a note to clients.

The group's stock sank Tuesday and fell by more than one percent at the opening bell on Wednesday, but it is still up markedly since the beginning of the year, with enthusiasm for AI-related companies having sent its share price rocketing over the past year.

"Nvidia has not said anything yet, and the market is already making big swings," said SwissQuote analyst Ipek Ozkardeskaya.

"It almost feels like Nvidia earnings could be a decisive moment in the AI rally as many expect the AI bubble to burst at some point."

Elsewhere, Chinese equities rose Wednesday in what analysts said was a delayed reaction to a cut in local interest rates.

The People's Bank of China said Tuesday that it was lowering the five-year loan prime rate, used to price mortgages, from 4.2 to 3.95 percent -- the largest reduction since the key rate was revamped in 2019.