U.S. equity futures traded lower on Thursday morning, suggesting Wall Street could retreat after the strong gains recorded in the previous session.
Markets came under renewed pressure as crude oil prices rebounded sharply and Treasury yields moved higher once again.
U.S. oil futures climbed more than 2%, pushing back above US$100 per barrel as investors continued to track negotiations tied to a possible U.S.-Iran peace agreement.
Treasury yields also recovered after Wednesday’s steep declines, although the benchmark 10-year yield remains below the one-year peak reached earlier in the week.
Nvidia Pulls Back Despite Strong Earnings
Shares of NVIDIA (NASDAQ:NVDA) slipped 0.7% in premarket trading despite the company delivering quarterly earnings above expectations.
Investors appeared increasingly focused on whether Nvidia can maintain its exceptional growth trajectory.
“The chip giant is starting to sound like a broken record, playing the same message over and over again,” said Dan Coatsworth, head of markets at AJ Bell. “It effectively says AI demand is strong, lots of customers are queuing up for its chips, and there is still much more to go for.”
“The market’s attention is now focused on how long Nvidia can sustain this momentum,” he added. “Even the fastest or strongest athletes run out of steam at some point, and investors are starting to worry that Nvidia cannot keep up its current pace.”
Walmart Weighs on Sentiment
Shares of Walmart (NYSE:WMT) dropped 2.8% in premarket trading after the retailer issued guidance that disappointed investors.
Wednesday Rally Fueled by Falling Oil and Yields
Wall Street rallied strongly on Wednesday following several weaker sessions.
The Nasdaq climbed 1.5% to 26,270.36, while the Dow Jones Industrial Average gained 1.3% to 50,009.35. The S&P 500 advanced 1.1% to 7,432.97.
The rebound was largely supported by falling Treasury yields and a sharp retreat in crude oil prices.
Oil Falls After Trump Comments on Iran
The 10-year Treasury yield dropped sharply from one-year highs as oil prices slid more than 5% amid optimism that the U.S.-Iran conflict could move toward resolution.
Crude futures fell below US$100 per barrel after President Donald Trump said the conflict was in the “final stages.”
Trump nevertheless maintained a tougher tone, warning reporters: “We’ll either have a deal or we’re going to do some things that are a little bit nasty.”
Airlines and Chip Stocks Lead Gains
Airline stocks were among the strongest performers as lower oil prices improved the outlook for fuel costs, with the NYSE Arca Airline Index jumping 8.1%.
Semiconductor stocks also rallied sharply, lifting the Philadelphia Semiconductor Index by 4.5%.
Housing stocks advanced strongly as well, with the Philadelphia Housing Sector Index gaining 3.8%.
Gold, banking and computer hardware shares also moved higher, while oil producers declined sharply alongside crude prices.
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