Futures higher, Nvidia surges, Boeing labor union vote – what’s moving markets
Investing.com — US stock futures edged up on Thursday following a tech-fueled rally on Wall Street in the previous session. OpenAI is reportedly in talks to raise funds at a $150 billion valuation, possibly solidifying the company’s reputation as the posterchild of booming enthusiasm in artificial intelligence. Elsewhere, Boeing (NYSE:BA) employees in the US Pacific Northwest are likely to reject a tentative labor deal and support a potential work stoppage, media reports say.
1. Futures inch higher
US stock futures moved higher on Thursday, pointing to an extension in a tech-fueled rally in stocks in the prior session.
By 03:37 ET (07:37 GMT), the Dow futures contract had added 83 points or 0.2%, S&P 500 futures had ticked up by 12 points or 0.2%, and Nasdaq 100 futures had gained 56 points or 0.3%.
The main averages on Wall Street advanced on Wednesday, with the tech-heavy Nasdaq Composite in particular posting its largest daily increase in a month.
A surge in shares in artificial intelligence-darling Nvidia (NASDAQ:NVDA) (more below) bolstered big-name tech stocks and underpinned a rebound in equities following a morning sell-off in the wake of August US inflation figures.
While the data showed that headline consumer price growth had matched July’s pace on a monthly basis, the “core” reading — stripping out volatile items like food and fuel — had accelerated slightly. The result boosted expectations that the Federal Reserve will roll out a more measured 25-basis point interest rate cut at its next policy gathering on Sept. 17-18, rather than a more aggressive 50-basis point reduction.
2. Global chipmakers rally after Nvidia surge
Global semiconductor groups rose on Thursday following the surge in shares in Nvidia.
SK Hynix (KS:000660), Hon Hai Precision Industry (TW:2317) and Advantest Corp. (TYO:6857) — all Nvidia suppliers — moved higher in Asian trading, as well as Japan’s Tokyo Electron Ltd. (TYO:8035) and Renesas Electronics Corp . (TYO:6723). In Europe, ASM International (AS:ASMI) (AS:ASMI), ASML Holding (AS:ASML), and STMicroelectronics (EPA:STMPA) were in the green in early dealmaking.
The moves come after Nvidia’s stock price surged by 8.2% on Wednesday, its biggest one-day gain in six weeks. The stock was hovering just below the flatline in extended hours trading.
3. OpenAI in talks to raise funds at $150 billion valuation – reports
OpenAI is in talks to raise funds at a valuation of $150 billion, according to news reports, potentially cementing its status as an AI stalwart and one of the world’s most valuable startups.
The company is considering raising $6.5 billion in equity financing, and is also in talks with banks over a $5 billion credit line, Bloomberg News reported, citing people close to the matter.
The $150 billion valuation is nearly twice as large as the $86 billion at which it was valued earlier this year. According to the Financial Times, venture capital firm Thrive Capital is leading the funding round, while other prospective backers include Apple (NASDAQ:AAPL), Nvidia and Microsoft (NASDAQ:MSFT).
OpenAI’s popularity soared with the release of its ChatGPT bot in 2022, which helped ignite a wave of enthusiasm around the possible applications of AI.
4. Boeing workers to vote on tentative deal
Boeing could be facing a strike as soon as Friday should roughly 33,000 of the planemaker’s workers in the US Pacific Northwest vote to begin a work stoppage and reject a tentative labor deal.
The company had previously reached a tentative agreement for a 25% pay bump, along with a commitment to build a new plane in the Pacific Northwest, better retirement benefits and an increase to the union’s input into jet quality.
However, the employees, who are represented by the International Association of Machinists District 751, are likely to reject the deal on Thursday, according to media reports. Workers are reportedly asking for bigger wage increases and other improvements to the agreement.
A labor action would ratchet up scrutiny on new Boeing Chief Executive Kelly Ortberg, who is currently attempting to improve Boeing’s finances and rebuild its reputation after dangerous mid-air door plug breach in January. Ortberg has warned workers that a strike would put that recovery “in jeopardy.”
5. Oil jumps
Oil prices rose in European trade on Thursday as expectations of supply disruptions in the wake of Hurricane Francine tempered persistent concerns over slowing global crude demand.
Hurricane Francine made landfall in Louisiana on Wednesday after passing through the Gulf of Mexico, where several oil firms limited or suspended operations in the storm’s path.
Expectations of tighter supplies helped crude rebound from near three-year lows hit earlier this week, although, with the storm due to dissipate after making landfall, traders are beginning to focus once again on demand worries.
Brent oil futures expiring in November rose 1.6% to $71.71 a barrel, while West Texas Intermediate crude futures climbed 1.5% to $67.57 per barrel by 03:38 ET.
Reuters contributed to this report.