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U.S. stock-index futures surged on Thursday with the Dow and S&P 500 eyeing fresh records after Nvidia Corp.’s blowout earnings unleashed a wave of optimism that drove global markets higher.

How ae stock-index futures trading

  • S&P 500 futures
    rose 66 points, or 1.3% to 5063.

  • Dow Jones Industrial Average futures
    added 191 points, or 0.5%, to 38,871.

  • Nasdaq-100 futures
    surged 357 points, or 2%, to 17892.

On Wednesday, the S&P 500
eked out a gain to avoid a third day in the red. The index looks poised to erase losses from earlier in the week on Thursday.

What’s driving markets

Wall Street had seen timid trading at the start of the week as many investors feared the equity rally which took the S&P 500 index to a record close of 5029.73 last Friday was vulnerable should earnings from mega-tech AI-darling Nvidia

They should have had more faith.

After the close on Wednesday, the chipmaker, which by then was back down from third to fifth biggest U.S. company by market cap, delivered revenues, profits and forecasts that beat analysts already elevated expectations.

The news has sparked a global risk-on surge, which helped propel Japan’s and Europe’s benchmark equity barometers to new record levels, while leaving several U.S. benchmarks set to open in record territory.

“The big fear in recent days was that a disappointing quarter from Nvidia would lead to a loss of investor confidence in the tech space and that could cause contagion on the markets,” said Russ Mould, investment director at AJ Bell.

“Crisis has been averted after Nvidia smashed expectations with its latest results…a large beat on both earnings and sales has put a new rocket under the stock,” Mould added.

Nvidia shares were up more than 14% in premarket trading, dragging stocks such as Arm Holdings
up 10% and Super Micro Computer
up 15%, in its wake.

Now that this hurdle has been cleared, analysts expect the rally in U.S. stocks to continue.

“So, there you go, ladies and gentlemen, a potential misstep from Nvidia that would hammer the AI rally has simply not come. What now? The rally will probably continue,” Ipek Ozkardeskaya, senior analyst at Swissquote Bank.

Julian Emanuel, strategist at Evercore ISI summed up the mood simply: “FOMO remains bid”.

There are of course other companies reporting results. Moderna
and Wayfair
released earnings ahead of Thursday’s opening bell. Carvana
and Live Nation Entertainment
will present results of their own after the close.

U.S. economic updates on Thursday included the latest reading on weekly jobless claims, which fell to a five-week low at 201,000. Later, S&P flash services and manufacturing PMIs for February are due at 9:45 a.m., and January existing home sales at 10 a.m.

There are a number of Federal Reserve officials due to speak Thursday, as the 10-year Treasury yield
trades off 1.3 basis points to 4.307%, near the top of its 12-week range. Fed Vice Chair Philip Jefferson makes comments at 10 a.m., Philadelphia Fed President Patrick Harker talks at 3:15 p.m., Fed Gov. Lisa Cook and Minneapolis Fed President Neel Kashkari both speak at 5 p.m.

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