U.S. stock futures point to a sharply higher open on Thursday, signaling that equities may extend the momentum built in the prior session.
The renewed strength comes as investors enthusiastically respond to long-awaited quarterly results from market heavyweight and AI standard-bearer Nvidia (NASDAQ:NVDA).
Nvidia shares are up 5.1 percent in premarket trade after the chipmaker delivered third-quarter earnings that topped expectations and issued guidance that impressed the market.
These results have helped counterbalance recent anxiety over a potential AI-driven bubble that has pressured equities in recent days.
“Nvidia’s results had the potential to be a make-or-break moment for global financial markets,” said Dan Coatsworth, head of markets at AJ Bell. “Any disappointment could have fuelled concerns around an AI bubble poised to burst.”
“Fortunately, Nvidia has brought the party back to life, with suggestions that everything is hunky dory with all things AI,” he added. “Demand for its products remains strong, and chief executive Jensen Huang continues to talk up AI like it’s the best thing since sliced bread.”
Futures held on to sizable gains after the Labor Department published a long-delayed snapshot of the U.S. labor market, revealing job creation in September far outpaced forecasts.
Non-farm payrolls rose by 119,000 in September, reversing a revised decline of 4,000 in August. Economists had been expecting an increase of just 50,000 jobs.
The unemployment rate, meanwhile, ticked up to 4.4 percent from 4.3 percent, contrary to expectations for no change.
While the stronger-than-expected hiring data may ease fears about economic softening, it also makes a December rate cut from the Federal Reserve look less likely.
On Wednesday, Wall Street struggled to maintain early gains, with the major indexes fluctuating throughout the day before closing mostly in positive territory. The Nasdaq added 131.38 points or 0.6 percent to 22,564.23 after briefly jumping 1.7 percent earlier in the session. The S&P 500 rose 24.84 points or 0.4 percent to 6,642.16, and the Dow edged up 47.03 points or 0.1 percent to 46,138.77.
Early buying interest on Wednesday was driven by traders seeking bargains after several days of weakness that pushed the indexes to one-month lows. However, enthusiasm faded as investors awaited Nvidia’s earnings release after the bell.
Nvidia itself climbed 2.9 percent ahead of the announcement, rebounding from its weakest close in nearly a month.
Markets stayed choppy after the release of minutes from the Federal Reserve’s late-October meeting revealed a divided committee on the path of interest rates. Policymakers held “strongly differing views” on what the appropriate stance would be at the December 9-10 meeting.
While most officials agreed rates would eventually need to be lowered, the minutes noted that several did not see another 25-basis-point cut in December as warranted. Others suggested a cut could be justified if the economy developed as projected, while “many participants” favored holding rates steady through year-end.
Chipmakers staged a meaningful rebound, with the Philadelphia Semiconductor Index rising 1.8 percent after touching its lowest close in more than a month. Gold miners also advanced, as the NYSE Arca Gold Bugs Index rose 1.2 percent.
In contrast, energy stocks slid sharply alongside falling crude prices, pushing the NYSE Arca Oil Index down 1.7 percent.