Currently, U.S. index futures signal a positive opening for Thursday, potentially continuing the uptrend observed late in the previous session. Regarded as a frontrunner, Nvidia (NVDA) is poised to bolster market gains, reflecting a pre-market increase of 1.5%.
While Nvidia's fiscal third-quarter results—unveiled post-market on Wednesday—exceeded earnings and revenue expectations, they were initially met with trader trepidation due to concerns over decelerating revenue growth and a dip in gross margins quarter-over-quarter.
Despite experiencing weakness for most of the day on Wednesday, stocks rebounded towards the end of trading. This recovery lifted the major indices from their lowest points, though they ultimately closed with minimal changes. Notably, the Dow Jones Industrial Average rose by 139.53 points (0.3%) to settle at 43,408.47. The S&P 500 remained nearly static, experiencing a modest gain of 0.13 points, ending at 5,917.11. Conversely, the Nasdaq, dominated by technology stocks, saw a slight downturn of 21.32 points (0.1%) concluding at 18,966.14, after attempting a significant recovery from a steeper drop of 1.4%.
The stagnation of these averages coincided with market anticipation for Nvidia's quarterly report, released post-trading. In anticipation, Nvidia's stock fluctuated, eventually closing down by 0.8%.
Activity was further subdued due to a lack of influential U.S. economic announcements, with traders exercising caution amidst geopolitical tensions involving Ukraine and Russia. The session witnessed a notable surge in biotechnology stocks, pushing the NYSE Arca Biotechnology Index up by 1.8%, as it continued to recover from a prior three-month low.
Additionally, a hike in crude oil prices bolstered the oil service sector, while healthcare and pharmaceutical stocks showed robust performance. Conversely, the computer hardware sector experienced a downturn, with the NYSE Arca Computer Hardware Index declining by 1.3%, influenced heavily by Super Micro Computer (SMCI)'s substantial stock drop.
**Commodity and Currency Markets**
Crude oil futures have risen by $1.24 to $69.99 per barrel, rebounding from a $0.49 decrease to $68.75 on Wednesday. Gold futures, after a significant increase of $20.70 to $2,651.70 per ounce in the last session, continue to climb, now up by $17.40 to $2,669.10 per ounce.
In foreign exchange, the U.S. dollar is trading at 154.11 yen, down from the 155.44 yen closing rate in New York on Wednesday. Against the euro, it is valued at $1.0536, slightly lower than the previous day’s $1.0544.
**Asia**
Asian markets experienced mixed responses due to mixed cues from Nvidia's guidance, continued concerns over the Bank of Japan’s monetary strategy, and China’s underwhelming stimulus measures. Bank of Japan Governor Ueda Kazuo's remarks about a data-driven, meeting-by-meeting policy approach added to market unease.
China's Shanghai Composite Index rose marginally by 0.1% to 3,370.40, with its trading range fluctuating between 3,378.52 and 3,348.86. In Japan, the Nikkei 225 Index fell by 0.9% to 38,026.17, driven by caution ahead of CPI updates. Tokyo Gas surged nearly 5%, followed by M3 with a 4.4% gain, and Taiheiyo Cement Corp., Yamato Holdings, and Ube Industries each rising over 3%. However, IHI Corp. dropped nearly 4%, with declines also seen in Sumitomo Realty and Development Co., East Japan Railway Co., Aeon, and Mitsubishi Heavy Industries.
The Hang Seng Index on the Hong Kong Stock Exchange decreased by 0.5% to close at 19,601.11, while the Kospi Index in Korea edged down by 0.1% to 2,480.63. Australia's S&P/ASX 200 Index closed marginally lower at 8,323.00. Sigma Healthcare led gains with a 4.3% increase, with Amcor, Gold Road Resources, Pinnacle Investment Management Group, and Champion Iron all posting gains over 3%.Neuren Pharmaceuticals experienced further losses, seeing a decline of 9.2 percent. Shares in Pexa Group, Web Travel Group, IDP Education, and Johns Lyng Group also decreased by over 4 percent.
In contrast, the NZX 50 Index on the New Zealand Stock Exchange rose by 0.2 percent, concluding the day at 12,765.24, with trading fluctuating between 12,699.17 and 12,810.66. Pacific Edge drove the gains in healthcare stocks with a 7.6 percent increase, while Serko advanced 4 percent, and Ryman Healthcare added 3.1 percent. ANZ Group Holdings and Tourism Holdings each reported gains exceeding 2 percent.
On the downside, EROAD led declines, falling 3.2 percent, with Fletcher Building decreasing by 2.3 percent. Both Vital Healthcare Property Trust and Port of Tauranga slipped by close to 1 percent.
**Europe**
Following a modest decline in the previous session, major European markets displayed a mixed performance on Thursday. The French CAC 40 Index fell by 0.2 percent, while the UK’s FTSE 100 Index and Germany’s DAX Index both rose by 0.4 percent.
The decline in French markets is attributed to persisting geopolitical tensions and concerns over Europe’s economic prospects. Kering recorded the largest drop, plunging 2.9 percent. Teleperformance, Stellantis, EssilorLuxottica, Danone, and Renault all lost over 1 percent.
Conversely, Eurofins Scientific led gains with a rise of 1.3 percent, while Vinci and Axa each increased by over a quarter percent.
In the UK, a favorable corporate outlook overshadowed geopolitical and inflation concerns. Halma surged over 7 percent after reporting robust financial results. Meanwhile, Endeavour Mining, Centrica, and Beazley each rose by more than 2 percent. Experian and Diploma followed with increases exceeding 1.5 percent. However, JD Sports Fashion faced a significant drop of over 14 percent amid a profit warning. Vodafone and Frasers declined by over 2 percent, with Melrose Industries, National Grid, British Land Co, and DCC all suffering more than 1 percent declines.
The Confederation of British Industry’s Industrial Trends Survey, released earlier, indicated an acceleration in the decline of manufacturing output volumes in November, compared to the previous quarter to October. The balance of new orders improved to -19 in November from -27 in October, exceeding the market expectation of -25. Expectations for modest output volume increases in the upcoming quarter lent some support to market sentiment.
In Germany, Qiagen led with a 2.3 percent increase. Brenntag and Fresenius also performed well, each climbing by more than 1 percent. However, Porsche experienced a significant loss of nearly 4 percent, accompanied by declines in Adidas and Commerzbank of over 2 percent, and in BASF by 1.9 percent.
**U.S. Economic News**
The U.S. Labor Department issued a report on Thursday, unexpectedly indicating a slight decrease in initial jobless claims for the week ending November 16th. Initial claims decreased to 213,000, down by 6,000 from the prior week’s revised figure of 219,000, contrary to economists' projection of an increase to 220,000. This marked the lowest level of jobless claims since April 27th, when they were 209,000. The less volatile four-week moving average also decreased to 217,750 from the previous week’s revised average of 221,500.
Additionally, the Federal Reserve Bank of Philadelphia reported a softening in regional manufacturing activity for November, as shown by the diffusion index for current general activity dropping to -5.5 from 10.3 in October, signaling contraction. However, firms continue to anticipate growth over the next six months.
At 10 am ET, the National Association of Realtors will release data on October’s existing home sales, which are expected to rise to an annual rate of 3.93 million from 3.84 million in September. The Conference Board will also report October's leading economic indicators at the same time, anticipating a 0.3 percent dip following a 0.5 percent decrease in September. Moreover, at 11 am ET, the Treasury Department will announce the details of its upcoming auctions for two-year, five-year, and seven-year notes.Prominent Federal Reserve officials are scheduled to engage in key discussions today.
Chicago Fed President Austan Goolsbee will be part of a moderated Q&A session at the Central Indiana Corporate Partnership, beginning at 12:25 PM ET. Concurrently, at 12:30 PM ET, Kansas City Fed President Jeffrey Schmid will deliver remarks focusing on long-term growth considerations and monetary policy strategies.
Simultaneously, Cleveland Fed President Beth Hammack is set to participate in a dialogue at the 2024 Financial Stability Conference, which will address the emerging risks inherent in an era of interconnectedness and innovation.
Later in the day, at 4:40 PM ET, Michael Barr, the Federal Reserve's Vice Chair for Supervision, will join a discussion titled "Banks and Artificial Intelligence" during the 2024 FinRegLab AI Symposium.
