US equity futures pointed to a firmer open on Thursday, suggesting stocks may recover some ground after losses over the previous two sessions.
Technology shares were set to lead the rebound, with Nasdaq 100 futures up around 1.0%, reflecting renewed buying interest in the sector.
The improved tone in tech was partly driven by a positive market reaction to earnings from Taiwan Semiconductor (NYSE:TSM). Shares in the chipmaker rose more than 5% in pre-market trading after the world’s largest contract manufacturer reported a sharp jump in fourth-quarter profits.
“After last week’s revenue update it was an open secret that TSMC would be reporting a record quarter but the details are still striking,” said Russ Mould, investment director at AJ Bell.
“Not least the levels of capital expenditure TSMC is committing to, suggesting it is fully confident the AI boom has legs,” he added. “This is underlined by the company’s guidance for 30% growth in 2026.”
On the macro front, fresh US labour data offered some support. The Labor Department reported that initial claims for unemployment benefits unexpectedly fell in the week ended January 10. New filings declined to 198,000, down 9,000 from the prior week’s revised figure of 207,000, compared with expectations for an increase to 215,000.
The tentative rebound follows another weak session on Wednesday, when stocks extended losses despite paring an early sell-off. All three major indices closed in negative territory. The Nasdaq dropped 238.12 points, or 1.0%, to 23,471.75, while the S&P 500 fell 37.14 points, or 0.5%, to 6,926.60. The Dow Jones Industrial Average slipped 42.36 points, or 0.1%, to 49,149.63.
Recent declines have been partly attributed to rising geopolitical uncertainty, including renewed attention on tensions involving Greenland, political unrest in Iran and the ongoing Russia-Ukraine conflict.
Bank stocks also weighed on sentiment. Shares of Wells Fargo (NYSE:WFC) fell 4.6% after the lender posted better-than-expected fourth-quarter earnings but disappointed on revenue. Bank of America (NYSE:BAC) slid 3.8% despite beating analyst forecasts, while Citigroup (NYSE:C) also moved sharply lower even after reporting stronger-than-expected quarterly results.
Earlier data from the Commerce Department showed US retail sales rose more than anticipated in November. Sales increased 0.6% on the month, following a revised 0.1% decline in October, exceeding expectations for a 0.4% gain. Excluding autos, sales advanced 0.5%, ahead of forecasts for a 0.4% increase.
A separate Labor Department report showed producer prices rose modestly in November.
By sector, software stocks led the declines in the previous session, pulling the Dow Jones US Software Index down 2.4% to its lowest close in eight months. Networking stocks were also weak, with the NYSE Arca Networking Index down 1.6%. Airline and retail shares struggled, while energy stocks bucked the trend and posted solid gains.