U.S. stock futures experienced a notable increase on Thursday, boosted by impressive earnings from Nvidia, which helped to rejuvenate confidence in the artificial intelligence sector and mitigate concerns regarding a potential market bubble, at least temporarily. The Nasdaq 100 saw the most significant rise, with futures climbing 1.3%, followed by a 1% increase in S&P 500 futures. Futures for the Dow Jones Industrial Average, which comprises fewer technology stocks, rose 0.4%.
In premarket trading, Nvidia’s stock surged more than 5% after the chipmaker not only exceeded earnings expectations but also provided a robust revenue forecast for the fourth quarter. CEO Jensen Huang emphasized that demand for the company’s Blackwell processors is “off the charts,” which alleviated fears that the recent slowdown in AI-linked stocks indicated a longer-term downturn.
This positive response from the market came after a modest rebound on Wednesday, where both the S&P 500 and Dow broke a streak of four consecutive days of losses. Despite this uptick, major U.S. indexes still find themselves in negative territory for the week, reflecting a wider pullback in growth stocks.
Attention now shifts to the impending release of September’s nonfarm-payrolls report from the Bureau of Labor Statistics, which had been delayed due to the federal government shutdown. This report is anticipated to provide crucial insight into the U.S. economy since the shutdown left Wall Street navigating uncertain conditions regarding potential interest rate cuts by the Federal Reserve. Economists project that job gains will be modest, with estimates around 50,000 when the data becomes available at 8:30 a.m. ET.
The minutes from the Federal Reserve’s October meeting revealed a divergence of opinions among policymakers regarding whether a slowing labor market or persistent inflation represents a greater risk to the economy. This ongoing uncertainty is feeding into the speculation surrounding the Fed’s decision in December, with several officials indicating that no additional rate cuts are likely on the horizon.
Additionally, the labor market narrative is evolving as layoffs increase, raising questions about the stability of the “no-hire, no-fire” standard that has governed employment practices recently.
On the corporate front, Walmart is set to unveil its quarterly earnings before the market opens on Thursday, acting as a key barometer for large retailers as the holiday season approaches.
In Asia, technology stocks also saw a boost following Nvidia’s stellar earnings, easing concerns over an AI bubble. Shares of Taiwan’s TSMC, a major supplier to Nvidia, saw a rise of 4.3%, and its U.S.-listed stock was up 2.6% in premarket trading. Another partner of Nvidia, South Korea’s SK Hynix, reported a 1.6% increase, while Samsung Electronics gained nearly 4.3%. The positive momentum propelled technology-heavy indexes in Taiwan and South Korea higher, alongside a more than 2.6% increase in Japan’s Nikkei index, reclaiming the key 50,000 mark during the session.
Shares in several other tech and chip companies also rose in premarket trading following Nvidia’s reassuring earnings report. AMD stock surged nearly 5%, while both Micron and Broadcom saw increases. Major technology companies, including Meta, Microsoft, and Google, also experienced upward movement after the report’s release.
As investor hopes for a rate cut diminished, gold levels were reported as fluctuating, further indicating the cautious sentiment prevailing in the market.
