US stock futures experienced a modest increase late Thursday as Wall Street aimed to extend recent gains fueled by robust performances from financial and technology sectors. Contracts tied to the Dow Jones Industrial Average rose by 0.1%, while S&P 500 and Nasdaq 100 futures both increased by 0.2%.
During regular trading hours, stocks managed to reverse a two-day losing streak, largely driven by a surge in semiconductor shares. This uptick was propelled in part by a strong quarterly report from Taiwan Semiconductor Manufacturing Company (TSMC), which rejuvenated enthusiasm for artificial intelligence-related investments. TSMC’s shares saw an increase of more than 4%, and other industry heavyweights like Nvidia and AMD also rebounded.
Investor sentiment received an additional boost from a newly announced trade agreement between the US and Taiwan. This deal involves Taiwanese chip and technology firms committing to invest at least $250 billion to bolster US manufacturing capabilities.
Attention is also turning to the banking sector, which observed a rally following positive earnings reports from major financial institutions. Goldman Sachs saw its shares rise over 4%, and Morgan Stanley climbed nearly 6% after both companies released encouraging fourth-quarter results. Smaller financial entities, including PNC and Regions Financial, are scheduled to report earnings on Friday.
As the week draws to a close, investors are processing numerous political and geopolitical developments, including rising tensions involving Iran and Greenland. There are also growing concerns regarding the Federal Reserve’s autonomy. Amid ongoing legal challenges between the Trump administration and Federal Reserve Chair Jerome Powell, several Fed members have expressed support for maintaining current interest rates in an effort to manage inflation. According to the CME FedWatch tool, there is a 95% probability that rates will remain unchanged this month, with expectations for the central bank’s first cut in June.
Despite Thursday’s rally, major stock indexes are projected to finish the week lower, marking Wall Street’s initial stretch of volatility in the new year. The S&P 500 is down approximately 0.3% for the week, the Nasdaq Composite has fallen around 0.6%, and the Dow remains marginally lower.
