Buy tech sell-off, Wedbush’s Ives says: ’this is a 1996 moment, not 1999’
Investing.com - U.S. stock futures tick up ahead of the last session of the trading week. Investors will have the chance to parse through a new survey of consumer sentiment from the University of Michigan, although the release of official economic data is on hiatus during the continued U.S. government shutdown. Data center services firm Applied Digital shares spike in extended hours trading as quarterly revenue tops estimates, while denim jeans label Levi Strauss falls as analysts say its returns, while solid, may not have lived up to lofty expectations. Elsewhere, golds slides back below $4,000 an ounce, as a ceasefire deal between Israel and Hamas takes some of the shine off of the metal’s safe-haven appeal.
1. Futures higher
U.S. stock futures pointed higher on Friday, suggesting a positive end to the trading week after equities came under pressure in the prior session.
By 02:42 ET (06:42 GMT), the Dow futures contract had ticked up by 68 points, or 0.2%, S&P futures had risen by 11 points, or 0.2%, and Nasdaq 100 futures had gained 54 points, or 0.2%.
The main averages on Wall Street fell on Thursday, as investors weighed the implications of an ongoing U.S. government shutdown against continued enthusiasm around artificial intelligence. Market observers have begun to flag worries over the circular nature of recent AI dealmaking, although some analysts have argued that investors’ fear of missing out on further advances in the boom have kept the rally intact.
Earnings from packaged food and drink maker PepsiCo and carrier Delta Air Lines were also in focus, as the numbers were a vanguard of the upcoming third-quarter reporting period. Shares in both firms climbed.
2. University of Michigan survey ahead
The economic calendar has been largely quiet since the federal government shutdown delayed the release of key official indicators.
Should lawmakers in Washington fail to resolve a now more than week-old standoff, more numbers could be postponed, namely crucial U.S. inflation data next week.
A lack of fresh trackers of prices and job growth has particularly complicated how the Federal Reserve plans to approach future interest rate decisions. The central bank slashed rates by 25 basis points last month and signaled that it could roll out further drawdowns this year, but without up-to-date figures, the timing and scope of these moves remain murky.
Instead, policymakers have turned to secondary or alternative sources of information. One such gauge, a survey of consumer sentiment and inflation expectations from the University of Michigan, is due out on Friday.
3. Applied Digital revenue tops estimates
Shares of Applied Digital surged in extended hours trading, after the data center services provider posted better-than-anticipated fiscal first-quarter revenue.
Demand for data centers has skyrocketed as more businesses race to snap up the computing power needed to fuel their AI capabilities.
In August, Applied Digital notched a new lease agreement with AI-related group CoreWeave, while analysts have suggested that the firm may secure additional deals before the end of 2025.
For the quarter ended on August 31, revenue grew by 84% to $64.2 million, surpassing Wall Street estimates of $50 million, according to LSEG data cited by Reuters. Applied Digital’s per-share loss of $0.03 was also smaller than anticipated.
4. Levi Strauss lifts full-year guidance
Levi Strauss & Co raised its full-year revenue and profit forecast as it reported a strong quarterly result, helped by solid demand for its denim offerings and strong direct-to-consumer sales.
The jeans maker reported third-quarter earnings of $0.34 per share, beating analysts’ average estimate of $0.30 a piece. Revenue rose to $1.54 billion from $1.50 billion a year earlier, also above expectations.
Levi said it now expects fiscal 2025 adjusted earnings of $1.27 to $1.32 per share, compared with its prior view of $1.25 to $1.30.
Its outlook for reported net revenue growth was also increased to about 3% from a prior range of 1% to 2%, and organic growth to roughly 6% from 4.5% to 5.5%.
But shares tumbled by over 6% in after-hours trading. Analysts at Vital Knowledge said that while the firm "continues to execute very well in a tough macro environment," expectations were "fairly high" going in to the results, "which might explain some of the knee-jerk disappointment."
5. Gold slides below $4,000
Gold and other precious metal prices retreated from recent peaks as improving risk appetite, off the back of an Israel-Hamas ceasefire, spurred some profit-taking.
The deal, which was brokered by U.S. President Donald Trump, was approved by Israel’s government on Friday, and may clear the way for the stoppage in the two-year old war in Gaza. Easing geopolitical tensions could diminish a part of the allure of gold, which is traditionally viewed as a safe haven during times of economic or political uncertainty.
Bullion prices logged steep overnight losses, with strength in the dollar also weighing on wider metal prices. Some emerging doubts over the trajectory of U.S. interest rates, coupled with a slide in the Japanese yen and the euro, have supported the greenback this week.
Spot gold fell 0.3% to $3,965.93 an ounce, while gold futures for December rose 0.2% to $3,978.52/oz by 03:44 ET. Spot prices exceeded $4,000/oz for the first time ever this week.