PHOTO
Futures tracking the tech-heavy Nasdaq and the benchmark S&P 500 were flat on Thursday, after AI-darling Nvidia's quarterly forecast failed to impress investors but a beat on both revenue and earnings expectations signaled resilient demand.
Shares of the chip bellwether dropped nearly 5% in premarket trading after a largely in-line revenue forecast for the current quarter.
"The market may be disappointed not to see a bigger beat on its outlook, given what are now almost unattainable expectations, but the bottom line here is that the long-term story remains intact," said Josh Gilbert, market analyst at investment platform eToro.
Semiconductor peers Broadcom and Advanced Micro Devices fell 1.9% and 1.6%, respectively. Shares of chip-making equipment providers Applied Materials and KLA Corp were down 0.1% each.
However, the declines were limited by gains in Nvidia's heavyweight megacap customers, which have been the focus of market euphoria on the prospect of artificial intelligence integration boosting corporate profits.
Microsoft rose 0.50%, Meta added 0.40%, Alphabet climbed 0.30% and Amazon.com was up 0.60%, while Apple gained 1%.
At 04:41 a.m., Dow E-minis were up 182 points, or 0.44%, S&P 500 E-minis were down 1.25 points, or 0.02%, and Nasdaq 100 E-minis were down 25 points, or 0.13%.
Markets have see-sawed between marginal gains and losses in the run-up to Nvidia's results, as traders waited to see if the company would sustain its unmatched revenue growth. There was also nervousness about what its earnings could mean for the trajectory of highly valued AI-related stocks.
The benchmark S&P 500 closed lower on Wednesday and is 1.3% from a record high, while the Dow is hovering around an all-time high.
Among other movers, Dow-component Salesforce beat Street expectations for second-quarter results, sending the cloud company's shares up 4.8%.
CrowdStrike dropped 5.2% after the cybersecurity company cut its revenue and profit forecasts in the aftermath of last month's global outage.
On the economic data front, traders await the second estimate of gross domestic product for the second quarter and jobless claims data for the week ended on Aug. 24, both due at 8:30 a.m. ET.
(Reporting by Purvi Agarwal and Johann M Cherian in Bengaluru; Editing by Pooja Desai)