Nasdaq Futures Climb as Chipmakers Provide a Boost, Middle East Developments in Focus

September Nasdaq 100 E-Mini futures (NQU26) are up +0.46% this morning, led by advances in chip and other AI-linked shares, while investors kept a close eye on developments in the Middle East.

Chip and AI infrastructure stocks advanced in pre-market trading after Bloomberg reported that SK Hynix's U.S. listing is more than seven times oversubscribed. Micron Technology (MU), Marvell Technology (MRVL), and Intel (INTC) were up more than +3%.

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Meanwhile, U.S. forces targeted 90 military sites in Iran, including missile and drone facilities near the Strait of Hormuz, on Wednesday night. Iran responded by launching strikes on U.S. bases in Bahrain, Kuwait, and Qatar, according to the semi-official Iranian Students' News Agency. U.S. President Donald Trump said on Wednesday that Iran had reached out in search of a deal, though Tehran made no mention of any new talks. The price of WTI crude wavered on Thursday.

Investors are now awaiting U.S. jobless claims data and remarks from Federal Reserve officials.

In yesterday's trading session, Wall Street's major indexes ended mixed. Software stocks declined, with Workday (WDAY) sliding over -4% and Intuit (INTU) dropping more than -3%. Also, airlines and other travel stocks slid as oil prices surged, with Carnival (CCL) and American Airlines Group (AAL) falling more than -3%. In addition, Navitas Semiconductor (NVTS) dropped over -4% after Wolfspeed filed a patent infringement lawsuit against the company. On the bullish side, most chip and AI infrastructure stocks advanced, with Broadcom (AVGO) climbing more than +4% after Apple said its expanded agreement with the company is expected to exceed $30 billion.

Economic data released on Wednesday showed that U.S. consumer credit unexpectedly fell by -$0.18 billion in May, weaker than expectations of $16.9 billion. Also, U.S. May wholesale inventories were revised lower to +0.1% m/m from the preliminary estimate of +0.3% m/m.

Minutes of the Federal Open Market Committee's June 16-17 meeting, released on Wednesday, showed growing concern among policymakers about inflation, even as worries over the labor market eased somewhat. "Participants generally assessed that information received over the intermeeting period suggested that upside risks to price stability remained elevated while downside risks to achieving maximum employment had moderated a bit," according to the FOMC minutes. Officials broadly agreed that they would need to raise interest rates if inflation remained elevated this year due to the Middle East conflict, tariffs, or robust demand driven by the AI investment boom. At the same time, most participants said they expected the central bank would "maintain or eventually lower the target range for the federal funds rate" if inflation pressures dissipated relatively soon.

"One thing is certain: future policy is heavily contingent on the political situation in the Middle East. If we can tease out any forward guidance from the minutes, it would be the committee is working through a wide range of scenarios and will not commit to a specific scenario until the incoming data provides necessary clarity," said Jeffrey Roach at LPL Financial.

U.S. rate futures have priced in a 72.7% probability of no rate change and a 27.3% chance of a 25 basis point rate hike at July's monetary policy meeting.

Today, investors will focus on U.S. Initial Jobless Claims data, set to be released in a couple of hours. Economists expect this figure to be 218K, compared to last week's number of 215K.

The National Association of Realtors' existing home sales data will also be released today. Economists foresee this figure coming in at 4.19 million in June, compared to 4.17 million in May.

In addition, market participants will be looking toward speeches from New York Fed President John Williams and Dallas Fed President Lorie Logan.

On the earnings front, snacks and soda maker PepsiCo (PEP) is scheduled to report its Q2 results today.

In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.58%, up +0.13%.