Microsoft on top, Boeing deal, UK public debt – what’s moving markets By Investing.com

Investing.com — Microsoft regains title as world’s most valuable company as Nvidia shares retreat. Wall Street is set for a quiet opening as Boeing closes in on regaining control of Spirit AeroSystems.

1. Microsoft takes the lead again, for now

Microsoft (NASDAQ: ) has regained the title of the world’s most valuable company, as Nvidia shares fell more than 3% on Thursday.

Nvidia (NASDAQ: ), whose market capitalization surpassed that of Microsoft on Tuesday, lost more than $100 billion to record a closing market value of $3.21 trillion.

Microsoft’s market value also fell, to $3.31 trillion, as its shares fell slightly during Thursday’s session.

Nvidia, Microsoft and Apple (NASDAQ: ) are in a three-horse race to become the world’s most valuable company — with the iPhone maker’s market capitalization at $3.22 trillion.

However, that could prove to be a setback in Nvidia’s seemingly relentless rise, with its stock having nearly tripled so far this year.

Nvidia stands at the forefront of a massive technological shift as the dominant provider of chips to support artificial intelligence applications. Revenue is expected to double this fiscal year to $120 billion and rise to $160 billion next year.

By comparison, software giant Microsoft is expected to grow revenue by about 16% for its fiscal year.

«Nvidia GPUs are essentially gold or the new oil in the tech sector as more enterprises and consumers move quickly down this path with the 4th Industrial Revolution underway,» Wedbush analysts said in a note. .

The investment firm notes that Nvidia’s dominance in data center AI spending positions it as a key player in the AI ​​revolution, with all AI-generating applications relying on its GPUs.

Wedbush predicts that over the next three years, more than 70% of enterprises will adopt AI use cases, leading to an estimated $1 trillion in incremental AI spending over the next decade.

2. Future earnings are stable ahead of key activity data

US futures traded largely unchanged on Friday but are on track for a winning week ahead of the release of widely watched activity data.

By 04:00 ET (08:00 GMT), the contract was 60 points, or 0.2%, lower, down 4 points, or 0.1%, while up 10 points, or 0.1 %.

Losses in the market, darling Nvidia weighed on both that and Thursday, with the former falling 0.3% and the latter 0.8%. It was the best performer, gaining 0.8% – its best day this month.

That said, all three major averages are on pace for weekly gains. The S&P 500 is on track for a 0.8% gain, the Nasdaq is up 0.2%, while the DJIA is set for a 1.4% gain.

Quarterly earnings are due from used-vehicle retailer CarMax (NYSE: ), while investors will also look to June Purchasing Managers’ Index readings for data on the health of the US economy.

data for the month of May is also scheduled for release.

3. Boeing nears deal to buy Spirit AeroSystems

Boeing (NYSE: ) is on the verge of agreeing to buy back Spirit Aerosystems (NYSE: ), its former subsidiary, according to a report from Reuters.

The planemaker began negotiations to buy back the supplier it spun off in 2005 earlier this year, but ran into difficulties because of Spirit’s work for Boeing’s arch-rival Airbus.

The European group had threatened to block any deal involving Boeing’s production of parts for its latest models.

However, there appears to have been progress on the thorny issue, as Boeing and Airbus have largely agreed to split the Spirit programs into work that Boeing will take back, along with work that the European rival will take on.

Boeing’s move to buy back Spirit is aimed at stabilizing a critical part of the supply chain for its best-selling jet after a mid-air strike on a new 737 MAX in January.

4. British public debt soars

The UK general election is approaching and a change of government looks increasingly likely as Keir Starmer’s Labor Party is well ahead of Prime Minister Rishi Sunak’s Conservatives in the polls.

However, the latest data shows the difficulties either side will have in stabilizing the country’s finances after Britain’s public debt rose last month to its highest level as a share of the economy since 1961.

rose to 99.8% of gross domestic product in May, from 96.1% a year earlier, the Office for National Statistics said on Friday.

Public debt rose in Britain during the COVID-19 pandemic and public finances have also been hit by sluggish growth and a rise in Bank of England interest rates to a 16-year high.

Both political parties have said they intend to stick to existing budget rules and have pledged not to raise the income tax rate, value-added tax or other major taxes.

5. Raw set for weekly earnings

Crude oil prices traded slightly lower on Friday but were set to rise for a second week, helped by signs of improving demand in the US, the world’s biggest oil consumer.

By 4 a.m. ET, WTI futures were trading 0.3% lower at $81.09 a barrel, while the contract was down 0.3% at $85.50 a barrel.

Both benchmarks are on track to record gains of more than 3% this week, trading near their highest levels in more than seven weeks.

Data released on Thursday from the US showed a drop in US crude oil inventories by 2.5 million barrels in the week ending June 14, more than the 2.2 million barrel draw that was expected.

Additionally, US government data showed that total output supplied, a proxy for domestic demand, rose by 1.9 million barrels per day (bpd) in the week to 21.1 million bpd.