Nasdaq futures rose Thursday after blockbuster earnings from AI chipmaker Micron, even as the US bond market reeled from its sharpest quarterly selloff in more than three decades. Softer-than-expected US inflation data also cut the odds of a Federal Reserve rate hike this month, while the 10-year Treasury yield pushed toward 5.306%.
Micron earnings lift Nasdaq futures
Nasdaq futures advanced 0.7% on Thursday. S&P 500 futures gained 0.4%. European stock futures, however, slid 0.75%.
The move followed strong results from Micron, a key supplier to AI bellwether Nvidia. The chipmaker's financial commitments under long-term supply agreements reached $32 billion, up from $22 billion in June, signaling robust demand for AI memory chips. Charu Chanana, chief investment strategist at Saxo, said Micron's results validate AI demand but noted markets are starting to ask whether the industry is nearing peak memory shortages.
The earnings also powered gains across Asian markets. Japan's Nikkei jumped more than 3%, and South Korea's KOSPI reversed earlier losses to gain 1.7%. Taiwan's benchmark rose 0.8%.
Treasury yields near 5.306% weigh on sentiment
Even so, the rally sits against a backdrop of elevated bond yields. The yield on the benchmark 10-year Treasury note hit 5.306%, its highest level since mid-June 2007. It gained 87 basis points over the July-September quarter, the biggest quarterly rise since 1994, according to LSEG data.
Darren Shames, global head of rates sales at Nomura, said the velocity of the rate move is what's really getting investors' attention. Yields in Japan, Germany, France and Britain have also climbed to multi-decade highs, with Japan's 10-year government bond yield at 3.11%.
Fed rate-cut odds slip after inflation data
Following Wednesday's softer-than-expected US inflation reading, traders priced in a 38% chance of a Fed hike this month, down from 50% a day earlier, CME's FedWatch tool showed. The Fed raised rates in September for the first time in three years and flagged further increases ahead.
New York Fed President John Williams tempered expectations for an October move, saying on Tuesday he saw "no urgency" for further action. The euro held steady at $1.1321 after dropping 2.5% last month, with the dollar staying firm, supported by elevated Treasury yields.
Source: Investing.com
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