Investing.com -- U.S. futures edged slightly into the green on Thursday, but remained muted as hopes for Federal Reserve interest rate cuts early this year continued to recede. Elsewhere, Google boss Sundar Pichai reportedly warns employees of more impending job cuts at the tech behemoth, while chipmaker TSMC says demand for artificial intelligence will fuel a year of "healthy growth."
1. Futures inch marginally higher
U.S. stock futures hovered mostly above the flatline on Thursday, pointing to a quiet start for equities after they slipped in the previous session.
By 05:00 ET (10:00 GMT), the Dow futures contract was mostly unchanged, S&P 500 futures had added 5 points or 0.1%, and Nasdaq 100 futures ticked up by 59 points or 0.4%.
The main indices on Wall Street fell on Wednesday, dragged lower by economic data which cooled bets that the Federal Reserve will soon begin to bring interest rates down from more than two-decade highs. Stronger-than-anticipated December retail sales figures suggested that American consumer health remains resilient despite recently elevated inflation and borrowing costs -- a prospect that could persuade Fed officials not to rush into imminent cuts.
Rate-sensitive momentum stocks retreated, weighing on the Nasdaq Composite in particular. The tech-heavy index shed 0.6%, while the benchmark S&P 500 dropped by 0.6% and 30-stock Dow Jones Industrial Average declined 0.3%.
2. Housing starts, Philly Fed data ahead
Fed policymakers and traders will have the chance to parse through further economic data on Thursday, as they search for more clues about the trajectory of price growth and broader activity.
Housing starts, a measure of new residential construction, are expected have increased by 1.426 million in December, down slightly from 1.560 million in the prior month. A key gauge of demand in the crucial U.S. real estate sector, housing starts can also provide investors some insight into consumer appetite for riskier big-ticket purchases.
Markets will be keeping an eye as well on the release of an index from the Philadelphia Federal Reserve that is generally considered to be a strong indicator of the state of the American manufacturing industry.
Meanwhile, Atlanta Fed President Raphael Bostic is due to make remarks in which he may discuss his outlook for interest rates. Earlier this month, Bostic said inflation now seems to be "on a path" to the Fed's stated 2% target, adding that he is "comfortable" with the central bank's "restrictive" policy stance.
3. Google's Pichai warns of more job cuts - The Verge
Google Chief Executive Sundar Pichai has warned employees that the search giant will further reduce headcount, according to a report in The Verge that cited an internal memo.
Pichai aruged in the memo that the cuts are needed to help simplify operations and increase velocity in some areas, the report said.
However, he reportedly claimed that the role eliminations will not be as large as they were last year and will not touch every team. Alphabet-owned Google said last week that it would be laying off hundreds of employees at multiple divisions, including its Voice Assistant unit and its hardware business overseeing gadgets like Nest and Fitbit.
Job cuts have hit companies across multiple industries in recent months, reflecting a push by many firms to rein in costs and focus spending on developing artificial intelligence software.
4. TSMC fourth-quarter profit falls, but tops estimates
Taiwan Semiconductor Corp (TW:2330) logged a smaller-than-estimated decline in its fourth-quarter profit as revenue was buoyed by increased sales of its most advanced chips.
The world’s largest contract semiconductor manufacturer forecast slightly weaker performance in the first quarter of 2024, but said that chip demand in the coming year will be bolstered by soaring enthusiasm around artificial intelligence.
"We expect 2024 to be a healthy growth year for TSMC, supported by [...] robust AI-related demand. AI models need to be supported by more powerful semiconductor hardware [...] thus the value of TSMC's technology position is increasing," CEO C.C. Wei said in a post-earnings call.
Profit for the three months to Dec. 31 fell to T$238.7 billion ($7.6 billion) from T$295.9 billion a year ago. On a per-share basis, income fell to T$9.21, but still beat Investing.com estimates of T$8.67.
5. Crude boosted by OPE outlook, U.S. output dip
Oil prices rose Thursday, boosted by a bullish OPEC demand outlook and a disruption to U.S. crude production caused by a cold snap in parts of the country.
By 05:00 ET, the U.S. crude futures traded 0.8% higher at $73.02 a barrel, while the Brent contract climbed 0.5% to $78.28 per barrel.
In a monthly report, oil group OPEC said it anticipates crude demand will remain relatively robust over the next two years. Harsh winter conditions in the U.S. state of North Dakota also led oil output there to fall by 650,000 to 700,000 barrels per day, less than half its typical production.
Additionally, Pakistan has launched retaliatory missile strikes into Iran, responding to strikes carried out by Iran inside Pakistani territory. The violence exacerbated fears of an expanding conflict in the Middle East, a development that could dent crude supplies.
But price gains were capped for now by an unexpected build in U.S. crude stockpiles and challenging recovery conditions in China.
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