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U.S. equity futures were mixed in early Thursday trading as investors looked to claw back some of the worst losses for tech stocks in more than two years yesterday as markets continue to navigate comments from Presidential frontrunner Donald Trump.
The Nasdaq suffered its biggest single-day decline sine 2022 on Wednesday, lead by a multibillion pummeling of the world’s biggest chip stocks following a Bloomberg interview with the former President that suggest ed a change in U.S. policy towards Taiwan should he win a second term.
His remarks, as well as reports that President Joe Biden is considering stiffer restrictions on U.S. tech exports to China, also lopped nearly 1.4% from the S&P 500 and extended the recent rotation into industrial and domestic-focused stocks, helping the Dow close north of 41,000 for the first time on record.
A stronger-than-expected second quarter earnings report from Taiwan Semiconductor, the Taiwan-based chip contractor at the epicenter of the global supply chain, looks to have steadied markets heading into the Thursday session, with the Nasdaq called around 70 points higher at the the opening bell.
Nvidia (NVDA) shares were marked 2.1% higher at $120.45 each, with Advanced Micro Devices (AMD) up 1.56% at $161.91 each.
The European Central Bank will make a key rate decision later this morning in Frankfurt.
A speech last night to the Republican National Convention in Milwaukee from Vice Presidential candidate JD Vance, however, suggested a tougher approach to Wall Street should the GOP emerge victorious in November, suggesting markets will need to continually reevaluate the political landscape over the coming months.
Heading into the start of the trading day on Wall Street, futures contracts tied to the S&P 500 suggest a modest 7 point opening bell decline, with the Dow Jones Industrial Average called 55 points lower after last night’s record close.
Tough day for YTD winners, with Tech seeing worst performance today (and now barely positive MTD); Comm Serv now down MTD … small caps had better performance relative to large caps and are leading dramatically MTD, led by Russell 2000 Value pic.twitter.com/whGuDwFlBx
— Liz Ann Sonders (@LizAnnSonders) July 17, 2024
Stocks in focus include Netflix (NFLX) , which posts second quarter earnings after the close of trading, with analysts looking for revenues of $9.53 billion and the addition of around 4.82 million new subscribers.
American Airlines (AAL) , meanwhile, fell 1.1% after the carrier issued a muted current quarter forecast, tied to falling airline fares, that offset a stronger-than-expected second quarter earnings report after the close of trading last night.
In the bond market, benchmark 10-year Treasury note yields were little-changed at 4.185% while 2-year notes were holding at 4.465% ahead of weekly jobless claims data and the Philadelphia Fed’s July activity index at 8:30 am Eastern time.
Markets will also be eying the European Central Bank’s interest rate decision in Frankfurt, which is expected to kept its key policy rate unchanged at 3.75% but likely signal two more cuts between now and the end of the year.
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In Europe, the region-wide Stoxx 600 index was marked 0.41% higher in Frankfurt, with Britain’s FTSE 100 rebounding 0.68% in early London dealing.
Overnight in Asia, the yen surged to a six week high of 156.46 against the U.S. dollar, extending speculation that the Ministry of Finance it intervening in the currency markets, while the Nikkei 225 fell 2.36% into the close of trading in Tokyo.
The MSCI ex-Japan benchmark, meanwhile, was marked 0.42% lower heading into the close of regional trading in Asia.
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