Nasdaq Futures Tread Water as Investors Cautiously Await Nvidia’s Earnings

September Nasdaq 100 E-Mini futures (NQU24) are trending down -0.06% this morning as market participants refrained from making big bets ahead of a highly anticipated earnings report from AI darling Nvidia.

In yesterday’s trading session, Wall Street’s main stock indexes closed in the green. ResMed (RMD) climbed over +7% and was the top percentage gainer on the S&P 500 after William Blair stated that the company sees the GLP-1 weight loss drug impact as a “tailwind” for its sleep apnea and CPAP business. Also, chip stocks gained ground, with Analog Devices (ADI) and Qualcomm (QCOM) rising more than +2%. In addition, Insulet (PODD) advanced over +6% after the medical device company obtained FDA approval for its Omnipod 5 automated insulin delivery system to treat individuals with Type 2 diabetes aged 18 and older. On the bearish side, Paramount Global (PARA) slumped more than -7% after media veteran Edgar Bronfman abandoned his bid to acquire the company. 

Economic data on Tuesday showed that the U.S. Conference Board’s consumer confidence index rose to a 6-month high of 103.3 in August, stronger than expectations of 100.9. Also, the U.S. June S&P/CS HPI Composite - 20 n.s.a. eased to a 6-month low of +6.5% y/y from +6.9% y/y in May (revised from +6.8% y/y), though it was higher than the +6.2% y/y consensus. At the same time, the U.S. Richmond Fed manufacturing survey unexpectedly fell to a 4-1/4 year low of -19 in August, weaker than expectations of -14.

Meanwhile, U.S. rate futures have priced in a 63.5% probability of a 25 basis point rate cut and a 36.5% chance of a 50 basis point rate cut at the next central bank meeting in September.

Today, all eyes are on Nvidia’s (NVDA) second-quarter earnings report, which is scheduled to be released after the market close. Expectations heading into the chipmaker’s quarterly results are high, with analysts forecasting another strong consensus beat that could lead to an upward revision in the company’s profit guidance.

“In our view, Nvidia’s earnings report may actually have more impact on the overall market than Jerome Powell’s Jackson Hole speech last week,” said Anthony Saglimbene at Ameriprise Financial.

Prominent tech firms like Salesforce (CRM), CrowdStrike (CRWD), and HP (HPQ) are also set to report their quarterly figures today.

On the economic data front, investors will likely focus on U.S. Crude Oil Inventories data due later in the day. Economists estimate this figure to be -2.700M, compared to last week’s value of -4.649M.

In addition, market participants will be looking toward a speech from Atlanta Fed President Raphael Bostic.

In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 3.824%, down -0.29%.

The Euro Stoxx 50 futures are up +0.35% this morning as market participants digested fresh economic data and looked ahead to Nvidia’s earnings report later in the day. Insurance and technology stocks outperformed on Wednesday, while mining stocks retreated. Data released by the statistics agency Insee on Wednesday showed that France’s household confidence indicator improved in August, reaching its highest level since February 2022. Separately, data from the European Central Bank released on Wednesday indicated that lending to Eurozone companies slightly decelerated in July from a year earlier despite a recent ECB interest rate cut, while credit growth among households surged to its highest level in nine months. Meanwhile, investors are also awaiting the Eurozone’s preliminary inflation data for August, scheduled for release on Friday, to gain further insights into the ECB’s policy trajectory. In corporate news, Ageas (AGS.BB) rose over +5% after the insurer reported stronger-than-expected half-year net operating results.

France’s Consumer Confidence data was released today.

The French August Consumer Confidence arrived at 92, in line with expectations.

Asian stock markets today settled mixed. China’s Shanghai Composite Index (SHCOMP) closed down -0.40% and Japan’s Nikkei 225 Stock Index (NIK) closed up +0.22%.

China’s Shanghai Composite Index closed lower today, falling to its lowest level since early February on the back of weak corporate earnings. Automobile and real estate stocks led the declines on Wednesday, while consumer-services stocks gained ground. Meanwhile, weak sentiment toward China resurfaced after e-commerce firm PDD Holdings provided sluggish guidance earlier this week. Sentiment also suffered this week after Canada announced it would impose a 100% tariff on imports of Chinese electric vehicles and a 25% tariff on imported steel and aluminum from China, following the example set by the U.S. and EU. In corporate news, Nongfu Spring Co. plunged over -10% in Hong Kong after the bottled water maker posted the slowest half-year profit growth in four years. At the same time, ANTA Sports Products climbed more than +4% after the Chinese sportswear giant revealed a share buyback plan worth up to $1.28 billion and reported a 17% increase in first-half net profit. Investors are now awaiting the release of official Chinese PMI figures for August, scheduled for Saturday, to gain further insights into the state of the world’s second-largest economy.

Japan’s Nikkei 225 Stock Index closed marginally higher today after fluctuating between slight gains and losses, as investors made position adjustments and anxiously awaited Nvidia’s earnings set for later in the day. Local stocks also benefited from a weaker yen as investors continued to evaluate the Bank of Japan’s monetary policy outlook. Consumer cyclical stocks led the gains on Wednesday. Cabinet Office data revealed on Wednesday that Japan’s final leading economic index, a predictor of future economic conditions, fell in June, marking the lowest reading since November 2023. Meanwhile, the yen continued to weaken against the dollar on Wednesday following remarks from Bank of Japan Deputy Governor Ryozo Himino. Himino stated that the BOJ will raise interest rates as long as inflation aligns with the central bank’s outlook, emphasizing the need to monitor developments with “utmost vigilance.” In corporate news, Rakuten Group surged over +9% after Morgan Stanley MUFG Securities and Citi raised their price targets on the stock. Also, Sony Group gained more than +2% after announcing it will increase the price of its PlayStation 5 in Japan. The Nikkei Volatility, which takes into account the implied volatility of Nikkei 225 options, closed down -4.99% to 22.47.

The Japanese June Leading Index came in at 109.0, stronger than expectations of 108.6.

Pre-Market U.S. Stock Movers

Ambarella (AMBA) surged about +20% in pre-market trading after the semiconductor company posted upbeat Q2 results and issued above-consensus Q3 revenue guidance.

Nordstrom (JWN) climbed over +7% in pre-market trading after the retailer reported stronger-than-expected Q2 adjusted EPS and raised the midpoint of its FY24 adjusted EPS guidance range.

Box (BOX) gained more than +6% in pre-market trading after the company reported better-than-expected Q2 results and boosted its full-year guidance.

e.l.f. Beauty (ELF) rose over +3% in pre-market trading after announcing the authorization of a new $500 million share repurchase program.

Moderna (MRNA) advanced about +0.6% in pre-market trading after HSBC upgraded the stock to Hold from Reduce with a $82 price target.

You can see more pre-market stock movers here

Today’s U.S. Earnings Spotlight: Wednesday - August 28th

NVIDIA (NVDA), Salesforce Inc (CRM), CrowdStrike Holdings (CRWD), HP Inc (HPQ), Veeva Systems A (VEEV), NetApp (NTAP), Li Auto (LI), Pure Storage Inc (PSTG), Cooper (COO), Okta (OKTA), Nutanix (NTNX), JM Smucker (SJM), Chewy (CHWY), Affirm Holdings (AFRM), Donaldson (DCI), Abercrombie&Fitch (ANF), Bath & Body Works (BBWI), Five Below (FIVE), Foot Locker (FL), Greif Bros (GEF), Golden Ocean (GOGL), Patterson (PDCO), Kohl’s Corp (KSS), Victoria's Secret Co (VSCO), Iris Energy (IREN), Global Blue Group Holding (GB), Phibro (PAHC), Applied Digital (APLD).

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