U.S. stock futures showed little movement following a strong rally in both the S&P 500 and Nasdaq Composite on Wednesday. Nvidia’s (NASDAQ: NVDA) market capitalization has surpassed $3 trillion, making it the world’s second most valuable company. Meanwhile, Lululemon Athletica (NASDAQ: LULU) reported impressive first-quarter results, boosting its shares in after-hours trading.
Futures Steady
U.S. stock futures were largely unchanged on Thursday after the S&P 500 and Nasdaq Composite reached record highs in the previous session. By 03:28 ET (07:28 GMT), futures for the S&P 500 and Dow were nearly flat, while Nasdaq 100 futures increased by 26 points or 0.1%.
On Wednesday, the S&P 500 rose 1.18% to 5,354.03, and the Nasdaq Composite climbed 1.95% to 17,186.38. The Dow Jones Industrial Average also saw gains, adding 0.3% to close at 38,807.33.
This rally was supported by a decline in the benchmark U.S. 10-year Treasury yield to a two-month low following weaker-than-expected private payroll data. This, along with a report earlier in the week indicating that job openings in April fell to their lowest level in over three years, suggests a cooling U.S. labor market.
A decrease in labor demand could ease inflationary pressures, raising hopes that the Federal Reserve might reduce interest rates from their highest levels in over two decades later this year.
Nvidia Surpasses Apple as World’s Second Most Valuable Company
Nvidia’s market capitalization soared past $3 trillion on Wednesday, overtaking Apple (NASDAQ: AAPL) as the world’s second most valuable company. The surge reflects growing enthusiasm for artificial intelligence applications. Nvidia’s AI-optimized chips have seen a significant rise in demand over the past year as businesses invest heavily in integrating this emerging technology.
Earlier this week, Nvidia surprised the market by announcing its new “Rubin” chip, only months after its last launch. Facing increased competition from chipmakers like Advanced Micro Devices (NASDAQ: AMD) and Intel (NASDAQ: INTC), as well as in-house processors from cloud computing giants such as Microsoft (NASDAQ: MSFT) and Google (NASDAQ: GOOGL), Nvidia is aiming for a “one-year” release cadence.
In May, Nvidia reported another strong earnings quarter, with a 262% increase in revenue and announced a 10-for-one stock split set to take effect on June 7.
Apple is expected to reveal more about its AI plans at its developers conference next week. Unlike many of its Big Tech peers, Apple has been relatively quiet about its AI ambitions, though CEO Tim Cook recently highlighted AI as a “key opportunity.”
Lululemon Shares Jump After-Hours
Lululemon Athletica’s shares rose by over 9% in extended trading after the athletic apparel retailer reported first-quarter earnings and sales that exceeded expectations. The Canadian company, known for its high-priced leggings, posted quarterly earnings per share of $2.54, surpassing Wall Street’s forecast of $2.38. Net revenue reached $2.21 billion, above the projected $2.19 billion. Lululemon also raised its annual earnings per share guidance and maintained its full-year net revenue outlook.
Strong performance in mainland China, where same-store sales increased by 33% compared to the previous year, offset flat results in the Americas. Analysts noted that Lululemon’s expansion in China aims to capitalize on relatively low domestic competition and counteract reduced demand from inflation-affected U.S. consumers.
Despite a 39% decline in its share price this year, Lululemon announced a $1 billion increase in its stock buyback program.
ECB Decision Looms
The European Central Bank is expected to lower interest rates from record highs at its Thursday meeting. Signs that inflation in the euro zone is approaching the ECB’s 2% target have bolstered this expectation, with policymakers indicating this move in the lead-up to the meeting.
ECB President Christine Lagarde and Chief Economist Philip Lane have both suggested that recent data supports reducing rates, barring any major surprises.
