U.S. stock index futures climbed on Wednesday evening, driven primarily by gains in technology stocks. This surge was largely attributed to strong earnings and optimistic forecasts from Nvidia, which led a rally in the tech sector.
Nvidia, regarded as a key indicator of tech and artificial intelligence demand, overshadowed ongoing worries about persistent U.S. inflation and high interest rates. These concerns were highlighted by the minutes from the Federal Reserve’s late-April meeting.
By 20:04 ET (00:04 GMT), S&P 500 Futures had increased by 0.2% to 5,340.75 points, while Nasdaq 100 Futures rose 0.5% to 18,872.00 points. In contrast, Dow Jones Futures dipped 0.1% to 39,739.0 points.
Nvidia Surges on Positive Q1 Results, Boosting Chipmaking Stocks
Nvidia Corporation (NASDAQ:NVDA) surged by up to 6% in aftermarket trading, hitting a record high of $1,006.95 per share after surpassing first-quarter earnings expectations. The company also provided a stronger-than-expected revenue forecast for the current quarter, driven by robust demand in the burgeoning AI industry.
Additionally, Nvidia announced a 10-for-one forward stock split.
The strong performance from Nvidia lifted shares of other major chipmakers. Advanced Micro Devices Inc (NASDAQ:AMD) and Broadcom Inc (NASDAQ:AVGO) both rose about 2%, while Intel Corporation (NASDAQ:INTC) gained 0.5%. Memory chip maker Micron Technology Inc (NASDAQ:MU) climbed 2.4%, and chip designer Arm Holdings (NASDAQ:ARM) increased by 3.2%.
Despite the positive earnings from Nvidia bolstering tech stocks, broader equities remained volatile due to concerns over prolonged high interest rates. The Federal Reserve’s minutes reinforced fears that the central bank is less confident about inflation sustainably returning to its 2% annual target.
Several Fed officials have echoed this sentiment in recent weeks. Although markets are still hoping for a rate cut in September, future inflation data will be crucial in determining the feasibility of such a move.
On Wednesday, Wall Street indexes closed lower amidst these concerns. The S&P 500 fell 0.3% to 5,307.01 points, the NASDAQ Composite dropped 0.2% to 16,801.54 points, and the Dow Jones Industrial Average declined 0.5% to 39,671.04 points. These declines came after all three indexes reached record highs earlier in the week.
Adding to the worries over high interest rates, Goldman Sachs CEO David Solomon stated he does not expect any rate cuts in 2024.
Aftermarket Moves: Live Nation Sinks on Report of DOJ Lawsuit
In major aftermarket moves, Live Nation Entertainment Inc (NYSE:LYV) plunged up to 9% following a report that the Department of Justice is planning a lawsuit against the company over alleged monopolistic practices by its Ticketmaster unit. Lawmakers are also reportedly seeking to separate Ticketmaster from Live Nation.
Conversely, News Corp (NASDAQ:NWSA) surged over 4% after announcing a content-sharing deal with OpenAI, granting the latter access to content from several of its major publications.
