Dow Futures: U.S. stock market futures surged on Wednesday, anticipating the release of crucial activity data and quarterly earnings reports, including those from Nvidia, the newly acclaimed chip manufacturer.
Around 06:30 ET (10:30 GMT), the Dow Futures indicated an increase of 115 points, equivalent to 0.3%. S&P 500 Futures saw a 20-point, or 0.4%, ascent, while Nasdaq 100 Futures demonstrated an 80-point climb, accounting for 0.5%.
In the previous session, both the prominent Dow Jones Industrial Average and the comprehensive S&P 500 had relinquished some of their recent gains, closing 0.5% and 0.3% lower, respectively. This drop was primarily attributed to weaknesses in various retail stocks, including Dick’s Sporting Goods (NYSE: DKS), which saw a dramatic 24% decline—the worst in its history—due to a reduction in its full-year earnings projection. Additionally, Macy’s (NYSE: M) encountered a 14% drop due to an 8% decrease in net sales during the second quarter on a year-over-year basis.
A number of retailers, including Kohl’s (NYSE: KSS), Peloton (NASDAQ: PTON), Foot Locker (NYSE: FL), Abercrombie & Fitch (NYSE: ANF), and Bath & Body Works (NYSE: BBWI), are poised to announce their results before the commencement of trading on Wednesday.
However, the focal point of the earnings announcements is likely to be Nvidia (NASDAQ: NVDA), the world’s most valuable chip designer. Nvidia is scheduled to reveal its latest quarterly figures after the markets close. As a significant player in the graphics processing unit sector, which drives generative artificial intelligence, Nvidia’s role in the burgeoning technology has garnered worldwide enthusiasm. Its stock price has tripled within the year, propelling its market capitalization beyond $1 trillion. The company’s outlook for the remainder of the year could substantially influence not only the trajectory of the AI sector but also the broader market sentiment.
Investors will also scrutinize economic data encompassing new home sales, building permits, and flash Purchasing Managers’ Index (PMI) readings for the manufacturing and services sectors. Despite a sequence of interest rate hikes designed to curb inflation, recent data, including stronger-than-anticipated retail sales and rising consumer confidence, indicates the resilience of the U.S. economy.
Richmond Fed President Thomas Barkin issued a cautionary statement, asserting that the U.S. central bank must be prepared to address a potential resurgence in the country’s economy in advance of the Federal Reserve’s annual symposium in Jackson Hole, Wyoming, scheduled to begin at the week’s end.
In contrast, Europe delivered less promising news on Wednesday, with flash surveys revealing a second consecutive month of business contraction in both the eurozone and the U.K.
Oil prices weakened due to Europe’s feeble PMI readings, serving as a reminder that demand might be impacted in the latter half of the year by this substantial consumer group. However, there was a positive development as U.S. crude inventories reduced by approximately 2.4 million barrels in the preceding week, according to data from the American Petroleum Institute. The Energy Information Administration, the U.S. energy department’s statistical division, is expected to confirm this decline later in the day.
As of 03:30 ET, U.S. crude futures indicated a 1.5% decrease, settling at $78.47 per barrel. Meanwhile, the Brent contract registered a 1.4% decline, reaching $82.84.
Furthermore, gold futures experienced a 0.2% rise, reaching $1,930.40 per ounce, while EUR/USD exhibited a 0.3% decrease, standing at 1.0807.