Global stocks decline as Nvidia earnings disappoint investors
- Global stocks fell in response to Nvidia's earnings report, which disappointed investors despite high profits.
- President Trump's tariff announcements on Mexico, Canada, and the European Union heightened market caution.
- Major indices in the U.S. declined, reflecting concerns over trade policies and economic data.
On February 27, 2025, global stock markets experienced significant declines as earnings from artificial intelligence chipmaker Nvidia fell short of investor expectations. Despite reporting an impressive $22 billion in quarterly profits, Nvidia's shares saw an 8.5 percent drop, highlighting a growing trend among investors who have become accustomed to overly optimistic earnings reports from the company. Market analyst Jack Ablin pointed out that although Nvidia performed well, it did not meet the heightened expectations established by previous results. The downturn in stock prices was exacerbated by comments from U.S. President Donald Trump, who indicated that 25 percent tariffs on imports from Mexico and Canada would begin shortly. Investors reacted to the news of these tariffs with caution, contributing to the overall decline in major U.S. indices, including a 1.6 percent drop in the S&P 500. This followed a series of disappointing economic data that suggested a shaky outlook for economic growth, leading to concerns about the broader implications of trade policies. European stock markets were similarly affected, continuing their poor performance in light of Trump's aggressive trade rhetoric. His statements last week indicated plans for imposing 25 percent tariffs on the European Union, creating anxiety among investors regarding the global economic landscape. In response to these developments, traders adopted a cautious approach, reflecting unease over the potential repercussions of the U.S. administration's trade policies. In the Asian markets, despite initially positive movement as Hong Kong's Hang Seng Index exceeded 24,000 points, driven by the strong performance of Chinese tech giants, traders soon took profits. Consequently, the markets finished lower on the day. In notable company news, Seven & I Holdings—owner of 7-Eleven in Japan—saw its shares plunge 11 percent after failing to secure a buyout offer. In contrast, engine manufacturer Rolls-Royce's shares surged 16 percent, while advertising firm WPP's shares dropped by 15.8 percent due to disappointing earnings updates. Overall, the day's trading was marked by volatility and caution as investors weighed corporate earnings and geopolitical developments.