U.S. stock index futures jumped Thursday as investors cheered the latest quarterly results from Nvidia. Meanwhile, Dow Jones Industrial Average futures slid after Fitch Ratings placed the United States’ AAA rating on a negative rating watch. S&P 500 futures were up 0.9%, while Nasdaq-100 futures popped 2.3%. Dow futures were down 12 points, or 0.04%. Nvidia shares surged 27% in the premarket trading after the artificial intelligence beneficiary gave stronger-than-expected revenue guidance for its fiscal second quarter, while also reporting beats on the top and bottom line in the previous quarter. Several analysts covering the stock hiked their price targets on the stock following the results. Other semiconductor stocks followed Nvidia higher, including AMD and Taiwan Semiconductor, which rose 6.4% and 9.7%, respectively. The VanEck Semiconductor ETF (SMH) popped 6.2%. “The macro point is that innovation in technology can outweigh the headwinds of a slowing economy, or higher interest rates,” said Dylan Kremer co-chief Investment Officer of Certuity. “Technology in particular and growth stocks are not dead.” Meanwhile, Fitch Ratings put the U.S.′ AAA long-term foreign-currency issuer default rating on a negative watch. The rating agency said the ongoing debt ceiling negotiations have raised the risks that the government could miss payments on some of its obligations. However, Fitch said it still expects a resolution before the X-date. “I think everyone is looking at the Nvidia story and running with it because it is a welcome break from debt ceiling talks, banking fears, and inflation along with Fed tightening,” said Ed Moya, senior market analyst at Oanda. Those moves follow a down day for the major averages, with the Dow Jones Industrial Average on Wednesday posting a fourth straight day of losses. The 30-stock index dropped 255.59 points, or 0.77%. The S&P 500 ended the day lower by 0.73%, while the Nasdaq Composite fell 0.61%. Debt ceiling negotiations continued to weigh on the major averages. The talks hit a hurdle earlier Wednesday. Later, House Speaker Kevin McCarthy indicated negotiations were making progress. In corporate earnings, retailers Best Buy, Dollar Tree and Ralph Lauren will report Thursday before the open. Traders can expect the second reading on gross domestic product in the first quarter before the open on Thursday, as well as the latest weekly jobless claims data. April pending home sales data is also on deck after the open. Economists polled by Dow Jones expect a rise of 0.8%, up from the decline of 5.2% the prior month. Hong Kong’s Hang Seng index led losses in Asia on Thursday, falling about 2% to close at 18,746.92 — the lowest level this year. Mainland Chinese markets also fell, with the Shanghai Composite down 0.11% to finish at 3,201.26, its lowest close in over four months. The Shenzhen Component closed 0.22% lower at 10,896.48 in its third straight day of losses. Asia-Pacific markets were largely lower amid lingering concerns over the U.S. debt ceiling negotiations and as the Bank of Korea held its benchmark interest rate steady for the third consecutive time. South Korea’s Kospi shed 0.5% to end at 2,554.69. its first drop after closing flat on Wednesday and after a seven-day winning streak. The Kosdaq lost 0.9% to close at 847.72. Australia’s S&P/ASX 200 declined 1.07% to end at 7,136.9 and record its fourth straight day of losses. The index also hit its lowest level in about two months. In Japan, the Nikkei 225 bucked the trend and rose 0.39% to end at 30,801.13, but the Topix saw a 0.29% loss to close at 2,146.15. Oil prices fell on Thursday after Russian Deputy Prime Minister Alexander Novak played down the prospect of further OPEC+ production cuts at its meeting next week. Brent crude futures was down 80 cents, or 1%, to $77.56 a barrel. U.S. West Texas Intermediate crude (WTI) fell 90 cents, or 1.2%, to $73.44. Gold prices were little changed on Thursday as the dollar advanced to a more than two-month high and sapped demand for the dollar-priced metal, while investors awaited developments in the drawn-out debt ceiling negotiations in Washington. Spot gold rose slightly to $1,961.30 per ounce. U.S. gold futures fell 0.1% to $1,962.20.
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