Dow Jones dips, Nasdaq climbs as Datadog and Fortinet soar

11:10am: Arm disappoints

Arm Holdings shares fell more than 8% Thursday after the chip designer’s latest earnings failed to impress investors despite strong data center growth.

While revenue came in roughly in line with expectations and data center sales more than doubled year-over-year, management held its near-term outlook unchanged even as demand for its AI-focused AGI CPUs surged.

Bank of America flagged the disconnect, noting supply constraints are capping upside and calling the company’s target of 15% AGI CPU market share by 2031 aggressive.

The bank maintained a Neutral rating, saying the AI opportunity appears largely priced into the stock.

10am: Dow opens flat, Nasdaq inches higher

It’s a circumspect start in New York, with the Dow Jones opening just below flat, the S&P 500 just above, while the Nasdaq climbed 0.35%.

On the S&P, top fallers were Zoetis, down 19% as the animal health company missed Q1 targets.

Top risers was Carvana, up 413%, but that is a mirage as it is as it executes a 5-for-1 forward stock split.

Datadog sprinted 31% higher to top the S&P and Nasdaq 100 after surprising with both its quarterly results and forecasts. The company said AI has been driving rather than cannibalising demand for its platform, as customers need monitoring and security for their cloud and AI deployments.

Cybersecurity outfit Fortinet was next, jumping 23% as it reported strong beats in revenue and earnings and lifted its full-year outlook.

8am: Modest start for stocs expected

US stocks are tipped to open modestly positively on Thursday as markets await a response from Tehran to Washington’s proposed peace plan.

Dow Jones futures were up 0.1% while S&P 500 and Nasdaq 100 futures hovered just above flat, paring earlier pre-market gains.

The muted tone follows a strong session on Wall Street, where tech stocks led the charge. The Nasdaq rose 2% to 25,839 and the S&P 500 gained 1.5% to close at 7,365, both closing at fresh record highs, while the Dow added 612 points, or 1.2%, to finish at 49,911.

The rally was driven by easing geopolitical tensions as President Trump paused the Strait of Hormuz tanker escort mission to allow space for talks with Iran, while reports suggested a deal to end the conflict could be close.

Later in the day, Trump said there had been “very good talks” over the past 24 hours and that an agreement was “very possible”, though he warned military action would resume if negotiations fail.

Both sides were said to be near agreement on a one-page memorandum, Reuters reported, though Iranian media said the proposal contains “unacceptable” elements.

With Iran expected to give its response to a US proposal to end the war later today, per a report from CNN, or at least by the weekend, markets are holding their breath.

Markets in Asia played catch-up in their Thursday session, with major indices up 2-3%, while Europe is softer, with the FTSE 100 down 0.55% and the DAX off 0.2%.

Attention now turns to a busy earnings slate, with pre-market updates from Shell, McDonald’s, Canadian Natural Resources and Howmet Aerospace, while Gilead, McKesson, Airbnb and Cloudflare report after the close.