Nvidia rallies as US 30-year yield tops 5%, sparking cautious market mood

Nvidia's stock rallied sharply, climbing 6.5% in after-hours trading following an upbeat revenue forecast that exceeded expectations despite challenges from softer Chinese demand and looming U.S. export restrictions. The company warned that new curbs could reduce current-quarter revenue by $8 billion, but strong international demand for AI chips helped offset these concerns.

This surge in Nvidia shares fueled gains in major tech indexes, with the Philadelphia Semiconductor Index rising 1.2% and the S&P 500 and Nasdaq also advancing. The rally reflects investor optimism in the tech sector amid mixed economic signals.

However, the broader market mood remains cautious as the U.S. 30-year Treasury yield climbed above 5%, a level historically associated with increased risk aversion. Investors are growing wary of escalating debt levels and excessive government spending, prompting a sell-off in Treasuries and the dollar, while turning to gold and foreign currencies as safer assets.

Adding to market uncertainty, a U.S. court recently blocked most of the Trump-era tariffs on China, complicating trade policy and economic forecasts. This ruling introduces new variables for investors to consider amid ongoing geopolitical tensions.

"Nvidia’s 4.8% rally fueled gains in the S&P 500 and Nasdaq after topping forecasts despite China export headwinds," analysts noted, highlighting the company's pivotal role in current market dynamics.

"The US 30-year yield creeping back above 5% has historically been a cue for broader risk aversion," signaling a cautious stance among investors despite pockets of tech optimism.

Overall, Nvidia's strong performance contrasts with a more guarded bond market, reflecting a complex investment landscape shaped by geopolitical, economic, and sector-specific factors.

Nvidia shares surged over 6% after an upbeat revenue forecast, driving gains in tech stocks despite concerns over softer Chinese demand and U.S. export restrictions. Meanwhile, the U.S. 30-year Treasury yield topped 5%, signaling cautious market sentiment amid rising debt worries and a court ruling blocking Trump-era China tariffs.