Nasdaq and Dow Jones futures show small gains as TSMC and Netflix earnings eyed
US stocks are predicted to get off to a slow start on Thursday, after Wall Street saw various fresh record highs reached in the previous session.
Nasdaq 100 futures were up 0.2%, with those for the Dow Jones and S&P 500 up 0.1%.
A day earlier, the S&P climbed 0.8% to above 7,000 for the first time, capping a sharp rebound from late-March’s eight-month lows, while the Nasdaq Composite jumped 1.6% to its own record high at 24,016. The Dow slipped 0.2% to 48,464 as Caterpillar and JPMorgan Chase led a group of cyclicals and financials lower.
Overall optimism has been driven by hopes of progress in US-Iran talks, with reports overnight that a Middle East ceasefire extension could be agreed to enable more talks between the US and Iran.
US President Donald Trump said the war is “close to over” and suggested a second round of face-to-face talks with Iran will take place in Pakistan by the end of the week.
Israel and Lebanon’s leaders are also due to talk today, Trump said in a social media post, for the first time in 34 years.
Also in the background, China announced stronger-than-expected GDP growth of 5% for the first quarter.
Market analyst David Morrison at Trade Nation noted that the month-long selloff that began at the end of February when the US and Israel launched attacks against Iran, and knocked about 8% off the S&P at its lowest point, has seen the index since soar over 11% to new highs.
This has been helped by the ‘Mag 7’ tech titans going on “an absolute tear” since the end of March, as have semiconductors and some banks, despite some mixed first quarter results.
“Investors piled back in to ‘buy the dip’, repeating a behaviour that has proved consistently profitable since October 2022,” he said.
“The ceasefire called late Tuesday last week appears to be holding, although the Strait of Hormuz remains closed to most shipping, and it’s still unclear how effective the US blockade of Iranian ports in the region is proving to be.
“One thing is for sure: investors seem comfortable adding to their exposure to equities despite an oil price which is up over a third since hostilities began, and, as around 20% of the global supply of crude oil, liquified natural gas, fertilisers and helium remain offline. It’s one thing to live with high energy prices. It’s quite another to live without any energy.”
On a technical analysis view, all the US majors are “looking overbought at current levels”, Morrison said, having risen “too far too fast, suggesting that a pullback may be on the cards”.
In corporate news, Taiwan Semiconductor (TSM) reported overnight and beat expectations, with chip demand momentum continuing. Shares are down 1.9% premarket, though.
Netflix reports after today’s close, with Pepsico, Abbott Labs, Charles Schwab, Prologis, BoNY Mellon, US Bancorp, Marsh and Travelers Companies, the smallest company in the Dow.