S&P 500 Futures Tick Up Amid Mixed Earnings, Chip Stocks Slump
S&P 500 futures climbed 0.2% on Thursday as investors digested the latest batch of corporate earnings reports. Meanwhile, Dow Jones Industrial Average futures added 56 points, or 0.1%, signaling a positive start to the day. However, Nasdaq 100 futures remained flat as semiconductor stocks experienced significant pressure following disappointing results from key chipmakers.
In the previous session, the broader market enjoyed back-to-back gains, with the Dow rising 317 points (0.71%), the S&P 500 adding 0.39%, and the Nasdaq Composite gaining 0.19%. The rally was bolstered by strong performance in Nvidia shares, while investors appeared to overlook concerns over trade tensions after President Donald Trump paused tariffs on Mexican and Canadian goods.
Semiconductor Stocks Under Pressure
In after-hours trading, semiconductor stocks took a hit, with Qualcomm falling by 5%. The decline followed news that its patent-licensing business would not experience sales growth this year due to the expiration of its agreement with Huawei. Arm Holdings also saw a 5% drop, despite surpassing quarterly expectations. The company revised down its full-year forecast, signaling uncertainty in the chipmaking industry.
However, the biggest blow came from Apple supplier Skyworks Solutions, which plummeted 28% after delivering weak revenue guidance for its mobile segment. The company also projected lower-than-expected quarterly profits, sparking concerns over a slowdown in the smartphone market.
Gloomy Guidance from Honeywell and Ford
Shares of Honeywell International dipped 3.5% after the company issued a downbeat forecast for 2025, projecting weaker sales and profit. Additionally, Honeywell announced plans to split into three independent entities, but the move failed to boost investor confidence.
Meanwhile, Ford saw its stock tumble 5.2% after warning of significant losses in its electric vehicle and software operations, expecting losses of up to $5.5 billion this year. The automaker also forecast a challenging 2025 outlook, further dampening investor sentiment.
Jobless Claims Exceed Expectations
In the latest labor market data, new unemployment claims rose to 219,000, surpassing the expected 214,000. The four-week moving average increased to 216,750, signaling some softening in the labor market. Continuing claims also rose to 1.89 million, indicating that more workers are struggling to find new employment. However, jobless claims remain within their recent range, and markets are now turning their attention to Friday’s nonfarm payrolls report for further insights into labor market conditions.
Focus Shifts to Payrolls and Fed Policy
With the S&P 500 trading just 1% below its all-time high, all eyes are now on the upcoming jobs report, which could influence Federal Reserve policy expectations. While traders expect the Fed to keep rates steady at its March meeting, many anticipate a rate cut by June.
However, analysts caution that potential new tariff policies could increase inflation, slowing the pace of rate cuts. As earnings season continues and economic data unfolds, traders will remain vigilant for further signals on market direction in the days ahead.
