Benzinga - by Shanthi Rexaline, Benzinga Editor.
Investors pinned hopes on Nvidia Corp.’s (NASDAQ:NVDA) earnings to reinvigorate market momentum, and the AI leader delivered an impressive beat-and-raise quarter. This news buoyed major index futures in early Thursday trading, signaling a positive start to the day. Analysts have advocated seizing the recent market dip as a buying opportunity, amplifying anticipation for robust buying activity amidst prevalent FOMO sentiments.
However, market participants remain attentive to several factors shaping the day’s trading landscape, including scheduled Fed speeches, weekly jobless claims data, and private-sector activity readings.
Cues From Wednesday’s Trading:
Wednesday’s market session concluded with a mixed tone as investors digested hawkish Fed minutes, coupled with some disappointing tech earnings, while anxiously awaiting Nvidia’s report. Minutes from the January Federal Open Market Committee meeting revealed the central bank’s cautious stance on rate cuts, preferring to await clearer signals of sustainable inflation trends.
The day commenced with major indexes opening lower, maintaining a sideways trajectory, before deepening losses post-Fed minutes release. A late-session surge helped propel the S&P 500 and Dow Industrials into positive territory, while the Nasdaq Composite, although ending lower, saw improvement from earlier lows, settling at its highest level since early February.
Energy and utility sectors led gains among the 11 S&P 500 sector classes, while IT stocks experienced declines, reflecting the day’s mixed sentiment.
| Index | Performance (+/-) | Value |
| Nasdaq Composite | -0.32% | 15,580.87 |
| S&P 500 Index | +0.13% | 4,981.80 |
| Dow Industrials | +0.13% | 38,612.24 |
| Russell 2000 | -1.41% | 2,004.14 |
Analyst Color:
Labor market indicators such as job creation, wages, and layoffs are key data that could be important for determining the sustainability of the market rally, said Morgan Stanley’s Lisa Shalett. “With equity valuations already rich, can today's economic strength translate to positive surprises in company earnings? The answer likely hinges on what happens in the U.S. labor market,” she said.
If the labor market remains tight, with more jobs than available workers, companies may be pressured to raise wages, Shalett said, adding this could boost consumer spending but weigh on company profits. On the other hand, additional slack in the labor market could result in increased productivity and higher corporate profits, she said. “But there's a risk that a decline in jobs could also bring down consumer spending,” she said.
The key question is whether the economy strikes a balance between the two sides of that scale, Shalett said.
Futures Today
Futures Performance On Thursday (as of 7 am ET)
| Futures | Performance (+/-) |
| Nasdaq 100 | +2.16% |
| S&P 500 | +1.35% |
| Dow | +0.40% |
| R2K | +0.60% |
In premarket trading on Thursday, the SPDR S&P 500 ETF Trust (NYSE:SPY) rose 1.33% to $503.80 and the Invesco QQQ ETF (NASDAQ:QQQ) climbed 2.14% to $434.73, according to Benzinga Pro data.
Upcoming Economic Data:
The Labor Department is due to release its weekly jobless claims report at 8:30 a.m. ET. The number of individuals claiming unemployment benefits may have climbed to 217,000 in the week ended Feb. 17, up from 212,000 in the previous week.
S&P Global is due to release its flash U.S. manufacturing and service sector readings at 9:45 a.m. ET. The manufacturing purchasing managers’ index is expected to dip from 50.7 in January to 50.5 in February, while the service sector PMI may have edged down from 52.5 to 52.4. Both sectors are expected to stay barely above the ’50’ mark, which demarcates expansion and contraction.
The National Association of Realtors will release its existing home sales report for January at 10 a.m. ET. Economists, on average, expect existing home sales to come in at a seasonally-adjusted annual rate of 3.96 million units, slightly up from the previous quarter’s 3.78 million units.
Among the Fed officials making public appearances on Thursday are:
- Fed Vice Chair Philip Jefferson: 10 a.m. ET
- Philadelphia Fed President Patrick Harker: 3:15 a.m. ET
- Fed Governor Lisa Cook: 5 p.m. ET
- Minneapolis Fed President Neel Kashkari: 5 p.m. ET
- Fed Gov. Christopher Waller: 7:35 p.m. ET
The Treasury will auction four- and eight-week bills at 11:30 a.m. ET and 30-year TIPS at 1 p.m. ET.
See also: Best Futures Trading Software
Stocks In Focus:
- Nvidia rose over 14% in premarket trading following its stellar quarterly performance.
- Other stocks moving on earnings are Five9, Inc. (NASDAQ:FIVN) (down over 6.60%), Lucid Group, Inc. (NASDAQ:LCID) (down over 8.5%), Rivian Automotive, Inc. (NASDAQ:RIVN) (down over 14%), Sunnova Energy International Inc. (NYSE:NOVA) (down over 4%) and Sunrun Inc. (NYSE:RUN) (down about 3%).
- Cars.com Inc. (NYSE:CARS), Cheniere Energy, Inc. (NYSE:LNG), Dominion Energy, Inc. (NYSE:D), Keurig Dr Pepper Inc. (NASDAQ:KDP), Moderna, Inc. (NASDAQ:MRNA), Newmont Corp. (NYSE:NEM), PG&E Corporation (NYSE:PCG), Pioneer Natural Resources Company (NYSE:PXD) and Wayfair Inc. (NYSE:W) are among the notable companies due to report their quarterly results before the market open.
- Those reporting after the close include Carvana Co. (NYSE:CVNA), Insulet Corporation (NASDAQ:PODD), Live Nation Entertainment, Inc. (NYSE:LYV), MercadoLibre, Inc. (NASDAQ:MELI) and Noble Corp Plc. (NYSE:NE).
Crude oil futures edged down 0.06% to $77.86 in early European session on Thursday after the commodity fell by 0.35% on Wednesday. The benchmark 10-year Treasury note slipped 0.018 percentage points at 4.305%. Yield spiked on Wednesday following the hawkish FOMC minutes.
Asian stocks closed Thursday’s session higher, encouraged by the spike in U.S. futures on Nvidia’s strong earnings. The European markets traded notably higher by late-morning trading.
In the currency market, the safe-haven U.S. dollar is weaker against most major currencies.
Related Link: Fed Minutes Stress Inflation Vigilance, Push Back Earlier Rate Cut Moves: Officials Flag Commercial Real Estate Risks
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