U.S. stock futures indicated a largely flat opening on Thursday, suggesting markets may struggle for clear direction after posting strong gains over the previous two sessions.
Investor sentiment appeared divided following earnings updates from Dow components Nvidia (NASDAQ:NVDA) and Salesforce (NYSE:CRM), raising expectations for potentially volatile trading early in the session.
Shares of Nvidia climbed about 1.0% in premarket activity after the artificial intelligence leader delivered fiscal fourth-quarter results that exceeded expectations and issued upbeat forward guidance.
“Despite markets already pricing in extraordinary year-on-year growth, Nvidia projected revenue for the next quarter well above consensus estimates,” said Daniela Hathorn, Senior Market Analyst at Capital.com.
She added, “The results reset a narrative that had begun to tilt overly bearish in recent sessions, where concerns around overspending, diminishing returns and intensifying competition had weighed on valuations.”
In contrast, Salesforce shares declined roughly 1.7% ahead of the open. While the enterprise software company reported stronger-than-expected quarterly earnings, investors reacted negatively to softer guidance for upcoming periods.
Wall Street finished Wednesday’s session mostly higher, extending momentum from earlier gains and helping the Nasdaq and S&P 500 fully recover losses recorded at the start of the week.
By the close, major indexes ended slightly below intraday highs. The Nasdaq advanced 288.40 points, or 1.3%, to 23,152.08, the S&P 500 gained 56.06 points, or 0.8%, to 6,946.13, and the Dow Jones Industrial Average rose 307.65 points, or 0.6%, to 49,482.15.
Part of Wednesday’s advance reflected optimism ahead of Nvidia’s earnings release after the closing bell, with the chipmaker’s shares rising 1.4% during the session.
Technology stocks broadly supported the rally. IBM Corp. (NYSE:IBM) jumped 3.6%, continuing its rebound after Monday’s sharp decline following UBS upgrading the stock to Neutral from Sell.
Oracle (NYSE:ORCL) also gained 1.2% after Oppenheimer raised its rating on the software company to Outperform from Perform.
Software names led market performance, with the Dow Jones U.S. Software Index climbing 3.1%. The index continued its recovery after dropping to a ten-month closing low earlier in the week as concerns about artificial intelligence disruption eased.
Computer hardware stocks also posted strong gains, reflected in a 2.9% rise in the NYSE Arca Computer Hardware Index.
Financials, networking companies and semiconductor stocks also showed notable strength, while housing-related shares moved sharply lower during the session.
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