Nvidia May Lead Wall Street Higher In Early Trading

The major U.S. index futures are currently pointing to a higher open on Thursday, with stocks likely to extend the upward move seen late in the previous session.

Nvidia (NVDA) may help lead the markets higher, as the AI darling has turned higher over the course of pre-market trading is currently jumping by 1.5 percent.

Traders initially reacted negatively to Nvidia’s fiscal third quarter results, which were released after the close of trading on Wednesday.

Nvidia reported better than expected third quarter earnings and revenues, but some traders expressed concerns about slowing revenue growth and a quarter-on-quarter decline by gross margins.

After seeing weakness throughout much of the session, stocks recovered in the latter part of the trading day on Wednesday. The major averages climbed well off their worst levels before eventually ending the session narrowly mixed.

The Dow ended the day up 139.53 points or 0.3 percent at 43,408.47, while the S&P 500 closed little changed, up just 0.13 points at 5,917.11.

The tech-heavy Nasdaq closed down 21.32 points or 0.1 percent at 18,966.14 but staged a notable recovery attempt after tumbling by as much as 1.4 percent.

The roughly flat close by the major averages came as traders looked ahead to the release of quarterly results from Nvidia after the close of trading. Nvidia fluctuated over the course of the session before closing down 0.8 percent.

The volatility seen late in the session also came as trading activity was somewhat subdued amid a lack of major U.S. economic data.

Traders may also have been reluctant to make more significant moves as they kept an eye on developments overseas amid escalating tensions between Ukraine and Russia.

Biotechnology stocks showed a strong move to the upside on the day, driving the NYSE Arca Biotechnology Index up by 1.8 percent. The index continued to regain ground after hitting a three-month closing low on Monday.

An increase by the price of crude oil also contributed to strength among oil service stocks, while healthcare and pharmaceutical stocks also turned in strong performances.

Meanwhile, notable weakness remained visible among computer hardware stocks, with the NYSE Arca Computer Hardware Index falling by 1.3 percent after surging over the two previous sessions. A sharp pullback by shares of Super Micro Computer (SMCI) weighed on the sector.

Commodity, Currency Markets

Crude oil futures are jumping $1.24 to $69.99 a barrel after falling $0.49 to $68.75 a barrel on Wednesday. Meanwhile, after surging $20.70 to $2,651.70 an ounce in the previous session, gold futures are climbing $17.40 to $2,669.10 an ounce.

On the currency front, the U.S. dollar is trading at 154.11 yen versus the 155.44 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.0536 compared to yesterday’s $1.0544.

Asia

Disappointing guidance from tech giant Nvidia offered little cheer for Asian markets rattled by uncertainty over the Bank of Japan’s monetary policy plans and less-than-expected stimulus measures from China.

Comments from Bank of Japan Governor Ueda Kazuo that the monetary policy stance would be dictated meeting-by-meeting based on data also unnerved markets.

China’s Shanghai Composite Index edged up 0.1 percent to finish trading at 3,370.40. The day’s trading ranged between 3,378.52 and 3,348.86. The Shenzhen Component Index edged down 0.1 percent to close at 10,819.88.

The Japanese benchmark Nikkei 225 Index slid 0.9 percent to close at 38,026.17. The day’s trading range was between 38,374.69 and 37,945.21. Anxiety ahead of the CPI update weighed on sentiment.

Tokyo Gas extended gains with a surge of close to 5 percent. Software business M3 followed with a gain of 4.4 percent. Taiheiyo Cement Corp., Yamato Holdings and Ube Industries all gained more than 3 percent.

IHI Corp. lost close to 4 percent. Sumitomo Realty and Development Co., East Japan Railway Co, Aeon and Mitsubishi Heavy Industries all declined more than 3 percent.

The Hang Seng Index of the Hong Kong Stock Exchange dropped 0.5 percent from the previous close to finish trading at 19,601.11. The day’s trading range was between a high of 19,764.62 and a low of 19,552.50.

The Korean Stock Exchange’s Kospi Index slipped 0.1 percent to close trading at 2,480.63. The day’s trading range was between 2,474.62 and 2,496.97.

Australia’s S&P/ASX200 Index closed trading at 8,323.00, edging down less than a tenth of a percent. The day’s trading range was between 8,305.40 and 8,362.80.

Sigma Healthcare led gains with a surge of 4.3 percent. Amcor, Gold Road Resources, Pinnacle Investment Management Group and Champion Iron all added more than 3 percent.

Neuren Pharmaceuticals extended losses with a decline of 9.2 percent. Pexa Group, Web Travel Group, IDP Education and Johns Lyng Group all fell more than 4 percent.

The NZX 50 Index of the New Zealand Stock Exchange gained 0.2 percent to close trading at 12,765.24. Trading ranged between 12,699.17 and 12,810.66.

Healthcare business Pacific Edge led gains with a 7.6 percent spike. Serko rallied 4 percent followed by Ryman Healthcare that gained 3.1 percent. ANZ Group Holdings and Tourism Holdings both added more than 2 percent in the day’s trading.

EROAD topped losses with a decline of 3.2 percent. Fletcher Building slipped 2.3 percent. Vital Healthcare Property Trust and Port of Tauranga both declined close to a percent.

Europe

After moving modestly lower over the course of the previous session, the major European markets are turning in a mixed performance during trading on Thursday.

While the French CAC 40 Index is down by 0.2 percent, the U.K.’s FTSE 100 Index and the German DAX Index are both up by 0.4 percent.

The weakness in the French markets comes amid lingering geopolitical tensions and worries about the economic outlook for Europe.

Kering led losses with a decline of 2.9 percent. Teleperformance, Stellantis, Essilor Luxottica, Danone and Renault have all lost more than 1 percent.

Meanwhile, Eurofins Scientific topped gains with a surge of 1.3 percent. Vinci and Axa have gained more than a quarter percent.

In the U.K., a positive outlook on the corporate sector has overshadowed concerns about geopolitics and inflation.

Halma has jumped more than 7 percent after posting strong financial results. Endeavour Mining, Centrica and Beazley, all gained more than 2 percent. Experian as well as Diploma followed with gains of more than 1.5 percent.

On the other hand, JD Sports Fashion has tumbled more than 14 percent amidst a profit warning. Vodafone and Frasers both slipped more than 2 percent. Melrose Industries, National Grid, British Land Co and DCC all suffered declines in excess of 1 percent.

In data released earlier in the day, the Confederation of British Industry’s Industrial Trends Survey showed manufacturing output volumes fall in the quarter to November, and at a faster pace than in the three months to October.

The monthly net balance of new orders stood at -19 in November versus -27 in October. Markets had expected a level of -25. Manufacturers expecting output volumes to rise modestly in the quarter to February lent support to market sentiment.

In Germany, Qiagen led with a gain of 2.3 percent. Brenntag and Fresenius have both rallied more than 1 percent in the day’s trading.

At the same time, Porsche topped losses with a decline of close to 4 percent. Adidas and Commerzbank have both slipped more than 2 percent. BASF followed with a decline of 1.9 percent.

U.S. Economic News

The Labor Department released a report on Thursday unexpectedly showing a modest decrease by first-time claims for U.S. unemployment benefits in the week ended November 16th.

The report said initial jobless claims slipped to 213,000, a decrease of 6,000 from the previous week’s revised level of 219,000.

Economists had expected jobless claims to inch up to 220,000 from the 217,000 originally reported for the previous week.

With the unexpected dip, jobless claims fell to their lowest level since hitting 209,000 in the week ended April 27th.

The Labor Department said the less volatile four-week moving average also edged down to 217,750, a decrease of 3,750 from the previous week’s revised average of 221,500.

A separate report released by the Federal Reserve Bank of Philadelphia on Thursday said regional manufacturing activity softened overall in the month of November.

The Philly Fed said its diffusion index for current general activity tumbled to a negative 5.5 in November from a positive 10.3 in October, with a negative reading indicating contraction. Economists had expected the index to edge down to a positive 8.0.

However, the Philly Fed said firms continue to expect growth over the next six months, with growth expectations more widespread this month.

At 10 am ET, the National Association of Realtors is scheduled to release its report on existing home sales in the month of October. Existing home sales are expected to increase to an annual rate of 3.93 million in October after falling to a rate of 3.84 million in September.

The Conference Board is also due to release its report on leading economic indicators in the month of October at 10 am ET. The leading economic index is expected to dip by 0.3 percent in October after declining by 0.5 percent in September.

At 11 am ET, the Treasury Department is scheduled to announce the details of this month’s auctions of two-year, five-year and seven-year notes.

Chicago Federal Reserve President Austan Goolsbee is due to participate in a moderated question-and-answer session before the Central Indiana Corporate Partnership at 12:25 pm ET.

At 12:30 pm ET, Kansas City Federal Reserve President Jeffrey Schmid is scheduled to speak on Longer-term Considerations for Growth and Monetary Policy.

Cleveland Federal Reserve President Beth Hammack is also due to participate in a conversation before the 2024 Financial Stability Conference: Emerging Risks in a Time of Interconnectedness and Innovation at 12:30 pm ET.

At 4:40 pm ET, Federal Reserve Vice Chair for Supervision Michael Barr is scheduled to participate in a “Banks and Artificial Intelligence” discussion before the 2024 FinRegLab AI Symposium.