WeekWatch

Nvidia earnings – excellent but not enough?

Last week was a busy time for markets.

In the US, markets delivered further gains. The S&P 500 rose for the eighth consecutive week. By style, small-cap and value outperformed growth and large-cap.

Chip maker Nvidia, the world’s most valuable company, reported another bumper set of results for the first quarter. Compared to the year before, sales rose by 85%, while net earnings increased threefold. In both cases, results were way ahead of expectations and confirmed high demand for data centres and AI. Historically, Nvidia’s earnings results have dominated much of the news flow and helped set investor sentiment. Yet, the past few quarters have shown how difficult it has become for the company to wow investors sufficiently to generate a positive share price reaction. Nvidia’s share price eased after results, though it remains about 20% higher year-to-date. Longer term, some analysts point to Nvidia’s extremely high (70%+) gross profit margins. The rapid roll-out of lower cost AI chips by competitors may not be a direct threat to Nvidia. However, it is likely to keep investors wondering how long it will be able to maintain such high margins.

SpaceX IPO – the largest in history

Confirmation that the world’s richest man, Elon Musk, will list his satellite and rocket company SpaceX, was another reason why the reaction to Nvidia’s earnings were relatively muted. As this week’s “In the picture” shows, SpaceX’s listing on 12 June is expected to be the largest in history, more than twice as large as oil major Saudi Aramco, the current largest.

Once listed on the tech-focused Nasdaq, SpaceX is expected to become one of the world’s most valuable companies, with an estimated market capitalisation of $1.75-$2 trillion. However, SpaceX’s recent earnings profile has been mixed and the company remains unprofitable. 2025 revenues of $18.7 billion were accompanied by losses of $4.9 billion.

While the prospectus highlights SpaceX’s goal to “make life multiplanetary, to understand the true nature of the universe and to extent the light of consciousness to the stars”, the company’s revenues are underpinned by its internet-service provider business Starlink. With almost 10,000 satellites, it is the only profitable part of the business. The company’s prospectus identifies a total market size of $29 trillion, with growth initially underpinned by demand for Starlink satellites, which are launched by SpaceX rockets.

Anthropic and ChatGPT – readying to go public?

Upbeat AI sentiment is being helped by AI coding giant Anthropic’s update that second quarter revenues will more than double to $10.9 billion, compared with the previous quarter. The operator of Claude says this will help it generate an operating profit by mid-year, ahead of expectations. While not a public company, Anthropic revealed these details during its latest funding round, which fuelled speculation the company is readying itself to go public.

Elsewhere, rival OpenAI, which operates ChatGPT, may list in September. The listing this year of three high profile tech and AI-related companies will reinforce 2026 as being the largest ever for IPO funds raised.

Pressure eases on UK gilts

UK government bonds (gilts) had a better week. One reason was that “bad news is good”, with a rise in the domestic unemployment rate to 5% in March, from 4.9% the month before. Reflecting the effects of the energy shock, as well as low business confidence, this update was not surprising. Yet, what is disappointing for the economy is at least good for gilts. Market expectations for future UK interest rate hikes have eased, and this in turn has seen gilt yields fall (and prices rise).

Comments by Andy Burnham, a contender for the Labour Party leadership and the post of prime minister, also reassured investors. Should he win the leadership challenge, he confirmed that he would commit to the existing government’s fiscal rules. The result was a recovery in the price of 10-year gilts yields, which only a week before were trading above 5%, levels not seen since 2008, ended the week at 4.9%.

Market indicators are now signalling that the Bank of England will make two 0.25% rate hikes this year, a reduction from the two to three that had recently been expected.

Energy markets in limbo?

Crude oil prices ended last week slightly lower, reflecting an easing in some of the supply dislocations. Yet as Hetal Mehta, Chief Economist at SJP notes, we have about six to eight weeks before there needs to be a resumption of tanker traffic through the Strait of Hormuz. She notes that some airlines who had been saying that there were going to be severe jet fuel shortages are now thinking supplies will be fine over the summer, commenting “a lot of energy experts seem to have been surprised we haven’t seen more dramatic prices moves, given how long the Strait of Hormuz has been closed.” A key reason for this is that considerable commercial reserves have been put to use, helping to mitigate the worst of the shocks.

Pensions Commission warns 15 million not saving enough for retirement

The Pensions Commission has warned that 15 million people across the UK are not saving enough for retirement.

In an interim report published last week, the government-backed Commission highlighted the key challenges facing the current system. Low and middle earners, the self-employed, and women are among those groups most at risk of inadequate pensions, it said. This is because they are failing to save enough for retirement.

The report also revealed that around 18 million people, equivalent to 45% of working age adults, are not saving into a pension. In addition, only 4% of the self-employed are saving for retirement.

The Pensions Commission will publish its final report in early 2027.

In its recently published Financial Health Report 2026, the fifth in the series, St. James's Place found cost of living pressures have caused a drop in financial resilience among UK households.

The survey, conducted by Opinium among 6,000 adults¹, found fewer people now describe themselves as financially comfortable, compared to 12 months ago (37% in 2026 compared to 42% in 2025).

NS&I to return money to bereaved families

National Savings and Investments (NS&I) is set to start returning £367 million to families affected by its missing savings scandal.

In March, it emerged that the state-backed bank was experiencing difficulties tracing accounts belonging to deceased customers.

The scandal resulted in the dismissal of NS&I’s then-chief executive. The new CEO has said the search process used for handling bereavement claims has now been fixed.

Source:

1. Opinium survey of 6,000 UK adults between 17 March and 9 April 2026, on behalf of St. James's Place. Quotas and post-weighting were applied to the sample to make the dataset representative of the UK adult population.