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U.S. stock futures edged higher on Friday, driven by technology sector gains, particularly in the Nasdaq 100. Leading the charge was Netflix, whose shares jumped 6.5% in premarket trading after exceeding Wall Street expectations for subscriber growth and projecting continued growth through the end of the year.
Other “Magnificent Seven” tech stocks that have propelled Wall Street’s rally this year also saw premarket gains. Apple rose 1.5% following data showing a surge in new iPhone sales in China, while Nvidia extended its gains, up 0.9%, benefiting from strong results by chipmaker TSMC. However, Tesla dropped 0.5% after U.S. regulators opened an investigation into the company’s self-driving software, following reports of four crashes, including one fatal incident.
Futures and Market Overview
- Dow E-minis: up 37 points (+0.09%)
- S&P 500 E-minis: up 10 points (+0.17%)
- Nasdaq 100 E-minis: up 76.5 points (+0.38%)
This follows a strong week for Wall Street, with the Dow Jones and S&P 500 reaching fresh record highs, while all three major indexes were on track for their sixth consecutive week of gains. The Russell 2000 small-cap index outperformed with a 2% rise.
Earnings and Corporate Movers
- Procter & Gamble was little changed after missing first-quarter sales expectations.
- SLB (formerly Schlumberger) added 1% after exceeding profit estimates for the quarter.
- American Express climbed 2.4% following better-than-expected quarterly profits.
Additionally, U.S. listings of Chinese companies surged as the Chinese central bank launched funding schemes to boost equity markets. Alibaba gained 2.9%, JD.com rose 5.5%, and PDD Holdings climbed 4.7%.
Economic Outlook and Interest Rates
U.S. Treasury yields ticked higher, with the 10-year note yield rising above 4.1%, which could put additional pressure on equities. However, expectations remain steady that the Federal Reserve will ease interest rates by 25 basis points at its November meeting, with odds currently at 92.1%, according to CME’s FedWatch tool.
Investors are also monitoring September housing starts data and speeches from Fed officials Christopher Waller, Neel Kashkari, and Raphael Bostic for further economic insight.
Despite the overall positive market momentum, some analysts warn that high stock valuations, with the S&P 500 trading at nearly 22 times forward earnings, could leave equities vulnerable to a pullback as investors seek less expensive sectors.
