Wall Street Futures Rise as Nvidia, Microsoft Drive AI Gains Amid Geopolitical Risks
U.S. Stock Index Futures Climb on AI Momentum and Geopolitical Concerns
June 1 (Reuters) - U.S. stock index futures climbed on Monday, starting June on a firm footing, as the latest AI push from Nvidia and Microsoft lifted shares, even as uncertainty over the Middle East war lingered.
Nvidia and Microsoft Lead AI Surge
Nvidia rose 1.6% in premarket trading after the world's most valuable company unveiled a new chip that brings AI capabilities to laptops and desktops, set for release this fall.
New Chip Partnership
The chip is a result of a three-year partnership with Microsoft to "reinvent the PC" for the AI era, Nvidia CEO Jensen Huang said. Microsoft shares gained 2.8%.
Impact on Other Chipmakers
Other PC chipmakers dropped. AMD and Intel fell 3.4% and 2.9%, respectively.
Geopolitical Tensions and Market Sentiment
The broader mood was more somber and oil prices climbed after the latest exchange of attacks between the U.S. and Iran raised concerns over efforts to negotiate to end the three-month-old war.
Wall Street's main indexes closed May at record highs, lifted by hopes of an eventual end to the Middle East war and blowout first-quarter earnings.
Upcoming Economic Events and Federal Reserve Outlook
Jobs Report and Fed Policy Meeting
Investors now turn to Friday's jobs report ahead of Kevin Warsh's debut policy meeting as the chairman of the U.S. Federal Reserve this month, against a backdrop of rising inflation fears linked to the Iran war.
Interest Rate Expectations
Traders price in a near 70% chance of a one-quarter-point rate hike before the end of the year.
Futures Performance Snapshot
At 05:18 a.m. ET, Dow E-minis were up 143 points, or 0.28%, and S&P 500 E-minis were up 17.5 points, or 0.23%. Nasdaq 100 E-minis were up 86.75 points, or 0.29%.
Company Earnings and Market Focus
Broadcom and Dell in the Spotlight
After AI server maker Dell posted a strong results outlook last week, focus will shift to Broadcom results on Wednesday. Broadcom is the second-largest U.S. chipmaker by market value after Nvidia.
Federal Reserve Commentary
Comments from a slew of Fed officials and a beige book report will also be in focus this week before the central bank enters its pre-meeting blackout period on Saturday.
Other Notable Movers
Cadence Design Systems
In other company news, Cadence Design Systems rose 8.2% after launching an autonomous engineer for chip design, powered by Nvidia.
Micron's Milestone
Micron advanced 5.3% to $1,022, topping the $1,000 mark for the first time. Its shares have soared nearly 90% in May.
(Reporting by Medha Singh in Bengaluru; Editing by Shinjini Ganguli)
