Futures Climb as Chip Stocks Rebound Following Sell-Off

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In premarket trading on Thursday, futures for the S&P 500 and the Nasdaq showed gains, partially driven by a rebound in some chip stocks following a recent sell-off. Chipmakers such as Advanced Micro Devices (AMD.O), Nvidia (NVDA.O), and Applied Materials (AMAT.O) saw gains ranging from 0.3% to 0.7%. Micron Technology (MU.O) surged by 1.7% after reports that it could receive over $6 billion in grants from the U.S. Commerce Department to support domestic chip factory projects.

The Philadelphia Semiconductor Index (.SOX), which experienced a significant drop of over 3% on Wednesday, remained down by nearly 13% from its recent record highs.

Treasury yields, which had risen earlier in the week, slightly retreated, with the yield on the 10-year note at 4.5772%. This minor decline helped alleviate some pressure on equities.

In the previous session, all three major indexes closed lower, marking the fourth consecutive day of losses for the S&P 500 and the Nasdaq. Investors remained cautious about the Federal Reserve’s stance on interest rates.

Cleveland Fed President Loretta Mester expressed optimism that price pressures would ease, potentially allowing the central bank to lower borrowing costs. However, Fed Governor Michelle Bowman suggested that progress on reducing U.S. inflation might have stalled, raising questions about whether interest rates were at an appropriate level.

Later in the day, investors will focus on remarks from New York Fed President John Williams and Atlanta Fed President Raphael Bostic. According to the CME FedWatch Tool, there is over a 46% chance of the Fed initiating an easing cycle in July.

In terms of corporate earnings, investors will watch for reports from KeyCorp (KEY.N), Comerica (CMA.N), and homebuilder D.R. Horton (DHI.N) before the opening bell. Additionally, weekly jobless claims and March existing home sales data are scheduled for release later in the day, rounding out an otherwise light data calendar.