US stock futures leaned higher on Wednesday after another tech-led selloff, in the countdown to closely watched earnings from Nvidia (NVDA) that will set the tone for the next leg of the AI trade.
Futures on the S&P 500 (ES=F) and the tech-heavy Nasdaq 100 (NQ=F) moved up about 0.4% and 0.5%, respectively. Meanwhile, Dow Jones Industrial Average futures (YM=F) edged up 0.2% on the heels of another day for sharp losses for stocks.
Investors are now bracing for Nvidia’s third-quarter earnings due after Wednesday’s close. Signs are the chipmaking giant’s report could swing its stock up to 7% in either direction. More broadly, it could prove a make-or-break moment for an S&P 500 (^GSPC) rally spurred by hopes for AI-fed growth, in particular for Nvidia.
Concerns about Big Tech’s massive spending on the AI buildout have fed into multiday declines for the Dow (^DJI), S&P 500, and the Nasdaq Composite (^IXIC), as high-profile investors offload holdings. Unease is growing that the likes of Amazon (AMZN) are stepping up their borrowing to fund AI ambitions just as the Federal Reserve looks set to put a brake on interest-rate cuts.
Given that, Fed minutes set for release later will be put under the microscope for insight into the economy and future policy. While that meeting delivered a rate cut despite division at the Fed, traders are now evenly split on whether the central bank will ease again in December.
That view could shift on Thursday, when the market gets the September jobs report — the first major data release since the government shutdown delayed economic updates.
With fresh data still sparse, big-box retailer earnings on Wednesday could offer the clearest read on the state of US consumer spending heading into the holiday season. Results from Target (TGT), Lowe’s (LOW), and TJX Companies (TJX) are due before the opening bell.
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Premarket trending tickers: Lowe’s, DoorDash, and MP Materials
Lowe’s (LOW) stock rose 4% before the bell after beating Wall Street estimates on quarterly sales. The retailer did, however, lower its full-year profit forecast amid growing economic uncertainty.
DoorDash (DASH) stock rose 3% before the bell following the news that Kroger will expand its partnerships with the online food ordering company.
MP Materials’ (MP) stock was up 4% in premarket trading on Thursday. The rare-earth company has seen some volatility over recent weeks due to export restrictions on rare earths from China. As part of the one-year trade truce, Beijing agreed to remove these restrictions; however, news has emerged that the details of that agreement have yet to be finalized between the US and China.
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