Welcome to this week’s edition of top stock market highlights.
Nvidia (NASDAQ: NVDA)
Nvidia continues to churn out market-beating products, and CEO Jensen Huang unveiled the GPU leader’s latest innovation, the Blackwell Ultra AI chip, during the company’s annual GTC event held in San Jose California.
The company also announced a GB300 superchip which combines two Blackwell Ultras with Nvidia’s Grace central processing unit.
Blackwell Ultra can perform 1.5x better than the Blackwell chip and also represents a 50-time increase in data centre revenue opportunity, principally because of its improved AI capabilities.
These chips are designed to power the AI requirements for hyperscale customers such as Amazon (NASDAQ: AMZN), Microsoft (NASDAQ: MSFT), and Meta Platforms (NASDAQ: META).
According to Nvidia, Blackwell Ultra is designed for “AI reasoning”, a type of AI processing that mimics how humans think and reach conclusions.
This new Blackwell chip will slot into Nvidia’s NVL72 server rack which combines 72 GB300 superchips, in a package that will deliver improved efficiency and serviceability.
Compared to Nvidia’s old Hopper chip, the new GB300 NVL72 rack can handle 1,000 tokens per second versus just 100 using the older chip.
This translates to the ability to answer user questions in 10 seconds, rather than the 90 seconds that Hopper would have taken.
The ninefold improvement in processing time is obviously a significant jump for the company, and the company is now ramping up production of the Blackwell Ultra at its fastest pace ever.
For its most recent quarter, Nvidia said that Blackwell contributed US$11 billion out of its total revenue of US$39.3 billion.
US Federal Reserve
Investors who were hoping for a further reduction in interest rates would have been disappointed with the US Federal Reserve’s latest meeting decision.
The central bank decided to maintain the benchmark rate for a second straight meeting as officials are concerned that inflation could remain persistently high.
Chairman Jerome Powell remarked that the President Trump’s tariffs may result in inflation staying elevated and that officials are in no hurry to adjust borrowing rates downwards.
Instead, they would wait for data on the impact of these policies before acting.
The benchmark federal funds rate remains in the range of 4.25% to 4.5%.
Powell said that his base case is for tariff-driven inflation to be transitory, but acknowledged that it would be tough to tease out the effects of tariffs versus other factors in being responsible for the rise in inflation.
The Federal Reserve updated its economic projects which included marked-down growth forecasts along with a higher estimate for inflation.
Officials are, however, still pencilling in a half-percentage point cut this year, which implies two rounds of quarter-point cuts.
Unemployment is expected to come in at 4.4%, a tad higher than the original 4.3% forecast.
The median estimate for inflation has increased from 2.5% to 2.8% to end the year, while economic growth is projected to come in at 1.7%, down from the original 2.1% forecast.
Alphabet (NASDAQ: GOOGL)
Alphabet, the parent company of search engine Google, has agreed to purchase cybersecurity company Wiz Inc for US$32 billion in cash.
This deal was hammered out less than a year after initial discussions fell apart as Wiz expressed its intention to stay independent.
The acquisition is Alphabet’s largest to date and the price tag is much higher than the initial US$23 billion which was offered for the firm back then.
Wiz will be integrated into Google’s cloud business once the deal closes, allowing the technology behemoth to offer new security products as it attempts to catch up with rivals Microsoft and Amazon.
The cybersecurity company originally intended to pursue an initial public offering.
Wiz’s CEO had intended for the company to grow in size to challenge incumbents Crowdstrike (NASDAQ: CRWD) and Palo Alto Networks (NASDAQ: PANW).
He was also worried about a protracted regulatory approval process and intense scrutiny from antitrust officials.
While Trump’s administration should be more permissive towards such deals, Alphabet’s offer may nevertheless still draw significant regulatory scrutiny.
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Disclosure: Royston Yang owns shares of Alphabet and Meta Platforms.
