In the evening trading session on Wednesday, S&P 500 and Nasdaq futures saw an increase, primarily led by the optimism surrounding the robust outlook of AI-favorite Nvidia. The Nasdaq outperformed, reflecting a heightened interest in technology stocks.
However, Dow futures remained subdued due to a series of weak earnings reports.
The minutes from the late-January Federal Reserve meeting indicated a reluctance to start cutting interest rates.
S&P 500 Futures experienced a 0.4% rise to reach 5,018.75 points, and Nasdaq 100 Futures surged by 0.9% to 17,688.25 points by 18:12 ET (23:12 GMT).
On the other hand, Dow Jones Futures slightly declined by 0.1% to 38,646.00 points. The noticeable gains in Nasdaq hinted at an increased appetite for technology stocks.
These positive movements in futures followed several moderate sessions on Wall Street.
Investors were locking in profits before the quarterly earnings report from NVIDIA Corporation (NASDAQ: NVDA) to assess whether the company could justify its high valuation amidst growing demand for artificial intelligence.
On Wednesday, the S&P 500 edged up by 0.1% to 4,981.80 points, the Dow Jones Industrial Average rose by 0.1% to 38,612.24 points, and the NASDAQ Composite dipped by 0.3% to 15,580.87 points.
Nvidia experienced a surge of 7.4% in aftermarket trading, reaching $724.70, nearing its record highs from earlier in February.
The chipmaker reported stronger-than-expected Q4 earnings and forecasted first-quarter revenue at around $24 billion, surpassing analyst expectations.
This positive performance indicated the company's anticipation of continued benefits from increased demand for AI development, as it is a key producer of chips designed for large-language models that gained popularity in 2023.
Nvidia's success had a positive impact on other major tech stocks, with Alphabet Inc (NASDAQ: GOOGL), Microsoft Corporation (NASDAQ: MSFT), and Meta Platforms Inc (NASDAQ: META) - all with AI products in their pipelines - seeing increases ranging from 0.2% to 1.4% in aftermarket trade.
In aftermarket trading, major chipmaking stocks, expected to benefit from increased AI demand, also surged. TSMC's (NYSE: TSM) U.S. shares rose by 3.3%, while Micron Technology Inc (NASDAQ: MU) and Intel Corporation (NASDAQ: INTC) added 1.6% and 0.9%, respectively.
Palantir Technologies Inc (NYSE: PLTR), Advanced Micro Devices Inc (NASDAQ: AMD), and Super Micro Computer Inc (NASDAQ: SMCI) also experienced surges ranging from 3.7% to 9%.
Despite the optimism in the tech sector, weakness in Dow futures suggested lingering concerns among investors regarding higher-for-longer interest rates.
Mixed earnings further contributed to the cautious sentiment. The Fed minutes reiterated the central bank's stance on maintaining elevated interest rates in the near term.
In the aftermath of trading, Etsy Inc (NASDAQ: ETSY) declined by 8.4% after reporting mixed earnings and guidance, while Rivian Automotive Inc (NASDAQ: RIVN) saw a 15% slide following the electric vehicle maker's disappointing production forecast for 2024.
Paraphrasing text from "Investing" all rights reserved by the original author.
