U.S. Stocks May Regain Ground On Upbeat Nvidia Earnings

After moving notably lower over the two previous sessions, stocks may move back to the upside in early trading on Thursday. The major index futures are currently pointing to a higher open for the markets, with the S&P 500 futures up by 0.8 percent.

The Nasdaq 100 futures are also surging by 2.2 percent, suggesting tech stocks are likely to lead an early rebound on Wall Street.

The upward momentum for tech stocks comes amid a surge by shares of Nvidia (NVDA), with the chipmaker soaring by 29.6 percent in pre-market trading.

Nvidia is spiking after reporting better than expected fiscal fourth quarter results and forecasting fiscal second quarter revenue well above analyst estimates.

Meanwhile, traders are likely to keep an eye on any developments in the U.S. debt ceiling negotiations amid lingering concerns about a potential default.

Reflecting the default concerns, Fitch Ratings along with Moody’s and S&P placed the United States “AAA” credit on “rating watch negative,” signaling downside risks to U.S. creditworthiness.

On the U.S. economic front, revised data released by the Commerce Department showed economic growth in the U.S. slowed less than previously estimated in the first three month of 2023.

The Commerce Department said gross domestic product climbed by 1.3 percent in the first quarter compared to the previously estimated 1.1 percent increase. Economists had expected the pace of GDP growth to be unrevised.

Despite the upward revision, the GDP growth in the first quarter still reflects a slowdown from the 2.6 percent jump seen in the fourth quarter of 2022.

A separate report released by the Labor Department showed a modest increase in first-time claims for U.S. unemployment benefits in the week ended May 20th.

The Labor Department said initial jobless claims crept up to 229,000, an increase of 4,000 from the previous week’s revised level of 225,000.

Economists had expected jobless claims to inch up to 245,000 from the 242,000 originally reported for the previous week.

Not long after the start of trading, The National Association of Realtors is due to release its report on pending home sales in the month of April. Pending home sales are expected to jump by 1.0 percent in April after plunging by 5.2 percent in March.

Following the steep drop seen in Tuesday’s session, stocks saw further downside during trading on Wednesday. The major averages all moved lower, with the tech-heavy Nasdaq pulling back further off the nine-month closing high set on Monday.

The major averages fluctuated in the final hour of trading but remained in negative territory. The Dow slid 255.59 points or 0.8 percent to 32,799.92, the Nasdaq fell 76.08 points or 0.6 percent to 12,484.16 and the S&P 500 dropped 30.34 points or 0.7 percent to 4,115.24.

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower on Thursday. Hong Kong’s Hang Seng Index plunged by 1.9 percent and South Korea’s Kospi fell by 0.5 percent, although Japan’s Nikkei 225 Index bucked the downtrend and rose by 0.4 percent.

The major European markets have also moved to the downside on the day. While the U.K.’s FTSE 100 Index has slipped by 0.3 percent, the French CAC 40 Index and the German DAX Index are both down by 0.2 percent.

In commodities trading, crude oil futures are slumping $1.14 to $73.20 a barrel after jumping $1.43 to $74.34 a barrel on Wednesday. Meanwhile, after falling $9.90 to $1,964.60 ounce in the previous session, gold futures are sliding $16 to $1,948.60 an ounce.

On the currency front, the U.S. dollar is trading at 139.68 yen versus the 139.47 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.0716 compared to yesterday’s $1.0750.

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