World shares ease on concerns about tech valuations
An index of global equity markets eased after reaching a new record high on Thursday as concerns over high valuations of leading technology companies weighed on markets after artificial intelligence chip maker Nvidia reported strong quarterly results.
Shares on Wall Street and in Europe traded lower as investors worried about the market value of Nvidia, the world’s most valuable company, as it digested another breakout quarter but forecast first-quarter revenue to hit a whopping $US78bn ($A110bn).
The biggest losers on Wall Street were technology and communications services, with Nvidia’s shares falling 4 percent. The Dow Jones Industrial Average rose 0.11 percent, while the S&P 500 fell 0.70 percent and the Nasdaq Composite fell 1.37 percent.
“When you look at a company like Nvidia, people are concerned about high valuations even though the forecasts, cash flow and everything else are significantly higher,” said Thomas Plumb, chief executive and portfolio manager at Plumb Funds in Madison, Wisconsin.
“But I think this sentiment will eventually coincide with reality,” said Plumb, whose largest investment holding is Nvidia.
In Europe, the STOXX 600 index fell 0.11 percent. MSCI’s All Stock Index fell 0.30 percent after rising to a record high of 1,063.86.
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