Morning Highlights: Nvidia adds $1 trillion, Wells Fargo resets limits, Asia rises

Nvidia's capitalization increased by $1 trillion in two months, thanks to investor confidence in the prospects of AI and steady demand for its hardware from tech giants. Wells Fargo achieved an important regulatory victory: the Fed lifted the bank's asset growth cap imposed after the 2018 scandals, which immediately boosted its shares. At the same time, Toyota Group announced the buyout of Toyota Industries for $33 billion, and the latter lost 13% of its capitalization. About these and other topics - in the review of key events by the morning of June 4.

Nvidia Corp. shares have recovered $1 trillion in two months, and investors are betting on a continued rally as earlier concerns give way to optimism, reported Bloomberg.

The company's reporting last week dispelled key market doubts, especially about how U.S. restrictions on shipments of advanced chips to China will affect revenue growth, the outlook for spending on artificial intelligence and Nvidia's ability to ramp up production of new Blackwell chips, according to Bloomberg. «There are positive answers to these questions,» said Thomas Martin, senior portfolio manager at Globalt Investments. - It's time to increase Nvidia's exposure to portfolios again.»

After two-and-a-half years of growth driven by strong demand for AI chips, Nvidia's stock sagged in early 2025 due to concerns about Donald Trump's trade policies and potential cost cutting from its biggest customers.

Nvidia shares rose 2.8% on Tuesday, June 3, and have added nearly 50% since their April low, bringing the company's market capitalization to nearly $3.45 trillion. Nvidia's market capitalization has slightly surpassed Microsoft's, making it the world's most valuable company for the first time since January. At the same time, Nvidia's stock remains 5% below its January record.

At the same time, risks remain: Nvidia could be hit by U.S. duties, as its chips are manufactured overseas, and China accounted for 13% of revenue in the first quarter. However, the company has signed large contracts with Middle Eastern governments, which will partially offset potential losses.

At Oninvest's request, Freedom Holding co-founder Igor Klyushnev predicts whether the company has potential for further growth. He notes that in an era of explosive growth in artificial intelligence, the company is in a unique position as the number one provider. The company is also leading the world of digital AI (neural network training, content generation, etc.), and its next big goal is to achieve leadership in real-world AI, i.e., physical AI. At the same time, he sees the key risk for the company in underestimating the speed at which Nvidia's competitors are growing (this was well demonstrated in January by China's DeepSeek platform). Klyushnev's text can be read in full here.

U.S. bank Wells Fargo & Co. has broken free of an asset limit imposed by the Federal Reserve (Fed) that had held back the bank's growth for more than seven years, reports Bloomberg. It was a major victory for CEO Charlie Scharf, and the bank's stock rose sharply.

The Federal Reserve announced on Tuesday that Wells Fargo has met all conditions necessary to remove restrictions imposed as part of its 2018 enforcement action. The regulator has completed a review of the bank's efforts to correct the violations, including an external independent assessment as well as its own review of its corporate governance and risk management framework.

The decision marks the end of nearly a decade of scandals at the fourth-largest U.S. bank and paves the way for its continued growth. The bank has missed out on about $39 billion in potential profits since the cap was imposed in February 2018, the toughest punishment in the history of the U.S. banking sector, according to Bloomberg estimates.

«The Fed's decision to remove the asset limit is a critical step in Wells Fargo's transformation,» said Scharf. - «We are excited to move forward with plans for sustainable growth and increased profits based on the processes and cultural changes we have put in place.

In honor of the event, the bank will give all of its full-time employees a $2,000 bonus, mostly in the form of restricted stock, Scharf added.

Following the announcement, Wells Fargo shares briefly jumped more than 10% after the end of the main session on the U.S. stock market. The stock ended Tuesday's extended trading up 3%.

«The removal of the asset limit demonstrates a successful adjustment at the appropriate level through focused management, effective board oversight, and strong regulation,» said Michael Barr, a member of the Fed's Board of Governors. - These elements must be maintained to ensure the sustainability of the bank's continued growth.»

Oil prices declined after two days of gains as positivity from a decline in U.S. inventories was offset by rains that slowed the spread of wildfires that had previously limited production in Canada, reports Reuters.

Brent futures traded around $65 a barrel after closing at a three-week high, while WTI was around $63. According to a knowledgeable Reuters source, the American Petroleum Institute (API) reported a 3.28 million barrel decline in inventories last week. If those figures are confirmed in official statistics on Wednesday, it would be the biggest drop since March.

One operator of production from Canada's oil sands resumed operations Monday after fires that at one point knocked out about 7 percent of production in the country, the world's fourth-largest oil producer. The fires jeopardized supplies to key U.S. oil storage facilities and weakened the effect of OPEC+ countries increasing production.

The rise in oil prices at the beginning of the week was driven by OPEC+'s decision to increase production at expected levels, easing fears of a more aggressive increase. Despite this, oil has fallen in price by about 12% since the beginning of the year due to OPEC+'s departure from its policy of protecting prices by limiting production and fears that US-led trade wars will hit demand.

«In the short term, the market is showing a moderately bullish trend amid volatility,» said Gao Mingyu, chief energy analyst at SDIC Essence Futures (Beijing). - But a rapid increase in production from OPEC+ will prevent the supply shortage caused by seasonal and geopolitical factors from persisting for long.»

Toyota Industries stock fell by 13% on Wednesday after news of Toyota Group's plans to buy the company and take it private in a 4,7 trillion yen ($33 billion). The deal comes amid mounting pressure from regulators and investors on Japanese companies to wind down traditional cross-shareholding practices, wrote Reuters. Japan's Financial Services Authority (FSA) has called for a reduction in such ties.

Toyota resorted to cross-ownership back in 2005 to protect itself from a takeover threat, explained Satoru Aoyama, head of corporate ratings at Fitch Ratings Japan. According to Kei Okamura, portfolio manager for Japanese equities at Neuberger Berman, we should expect other such deals within the Toyota group in the future.

According to data from Reuters, the offer includes a buyback of Toyota Industries shares at 16,300 yen apiece - well below Tuesday's closing price of 18,400 yen.

Toyota will create a new holding company to realize the deal. The development division of Toyota Fudosan will invest about 180 billion yen, Toyota Motor Chairman Akio Toyoda will invest 1 billion yen, and Toyota Motor itself will invest about 700 billion yen in non-voting preferred shares.

Loans from Sumitomo Mitsui Banking Corporation, MUFG Bank and Mizuho Bank will provide the remainder of the financing.

However, analyst Arun George (SmartKarma) pointed out that the offer looks «unattractive». He noted that the buyout price is below the midpoint of the range indicated by independent financial advisers. «The special committee asked three times to improve the final offer of 16,300 yen, but was rejected,» he added.

Asia-Pacific markets rallied on Wednesday as Wall Street climbed, led by a rally in technology stocks led by chip maker Nvidia, reported CNBC. South Korean stocks led the gains.

- South Korea's stock market rose after opposition leader Lee Jae-men won the presidential election. The Kospi index added 2.44 percent, reaching its highest level since August last year, while the Kosdaq index of small companies rose 1.18 percent.

«Lee's election promises emphasize improving the investment attractiveness of the Korean stock market,» said John Cho, Korea equity portfolio manager at J.P. Morgan Asset Management.

- In Japan, the Nikkei 225 index was up about 1 percent, while the broader Topix index was up about 0.7 percent.

- In mainland China, the CSI 300 index was adding 0.5 percent in morning trading, while the Hang Seng index in Hong Kong was up 0.7 percent.

- Australia's S&P/ASX 200 index added 0.8%. Australia's economy grew at an annualized rate of 1.3% in the first quarter of 2025, lower than the 1.5% forecast, according to a Reuters poll of economists. The growth rate was unchanged from the previous quarter.

- U.S. index futures were little changed after Wall Street posted gains the previous day amid a technology rally and an unexpectedly strong jobs report that showed a resilient U.S. labor market despite concerns about possible risks from tariffs. The S&P 500 index was up 0.58% at the end of trading on Tuesday to end at 5,970.37. The Dow Jones blue-chip index added 214.16 points, or 0.51%, to close at 42,519.64. The Nasdaq Composite index rose 0.81 percent to 19,398.96.