U.S. stock futures hovered around the flatline on Wednesday. The action comes after a sharp decline in Big Tech stocks and renewed fears over the path of rate cuts spurred a sell-off on Wall Street.
Data released Wednesday morning showed private sector job creation in December eased more than expected, while wages grew at the slowest pace since July 2021, according to payment processing firm ADP. Investors are now turning to minutes from the Fed’s December meeting are slated for release at 2 p.m. ET.
Market Snapshot
At 8:35 a.m. ET, S&P 500 futures were less than 0.1% higher, while Nasdaq-100 futures traded just above the flatline. Futures tied to the Dow Jones Industrial Average added 17 points, or less than 0.1%.
Pre-Market Movers
NVIDIA was up 1.3% in premarket trading after tumbling 6.2% on Tuesday, the stock's worst one-day percentage drop since a 9.5% decline on Sept. 3, 2024. Investors were disappointed CEO Jensen Huang provided relatively few details about the company's most lucrative business of providing chips to train and run artificial-intelligence models in his keynote address at the CES tech trade show on Monday. Benchmark Research analyst Cody Acree also noted how Huang failed to discuss some progress with Nvidia's next-generation GPU platform, Rubin.
Advanced Micro Devices fell 1.7% after HSBC analysts downgraded shares of the semiconductor company to Reduce from Buy with a price target of $110.
Palantir Technologies Inc. dropped 7.8% on Tuesday, making it the session's worst-performing stock in the S&P 500. It was Palantir's worst single-day percentage drop since May 7, 2024. Three exchange-traded funds run by Cathie Wood's ARK Investment Management disclosed late Monday they unloaded a combined 196,728 shares of Palantir, and sold another 4,890 shares on Tuesday. The company, a maker of AI software, was down 2% in premarket trading.
Shares of electric-vehicle maker Tesla Motors declined 0.6%. The stock fell 4.1% on Tuesday after BofA Securities analyst John Murphy downgraded Tesla to Hold from Buy. Meanwhile, the National Highway Traffic Safety Administration opened an investigation into Tesla's new " Actually Smart Summon" feature, which allows a Tesla owner to have his car drive itself to him in a parking lot.
Quantum-computing stocks such as D-Wave Quantum Inc., off 30%; Quantum Computing Inc., down 25%; Rigetti Computing, down 26%; and IONQ Inc. , down 18%, tumbled after Nvidia's Huang said "very useful" quantum computers won't be viable for 15 to 30 years. "If you kind of said 15 years for very useful quantum computers, that would probably be on the early side. If you said 30, it's probably on the late side," Huang said in a Q&A session during Nvidia's analyst day. "If you picked 20, I think a whole bunch of us would believe it."
Shares of Moderna, Inc. were up 1% in premarket trading, following Tuesday's gains of 12%. The vaccine maker is one of a few drug companies currently developing a vaccine for the H5N1 bird flu. The first bird flu death was reported in the U.S. earlier this week.
SolarEdge declined 5%. Citi analysts downgraded shares of the energy technology company to Sell from Neutral and cut their price target to $9 from $12. Citi cited SolarEdge's "tight liquidity, challenging earnings outlook, and competition."
Cal-Maine Foods, the egg producer, reported fiscal second-quarter earnings and revenue that beat analysts' estimates on holiday demand and higher egg prices, which the company said, "have continued to rise this fiscal year as supply levels of shell eggs have been restricted due to recent outbreaks of highly pathogenic avian influenza." The stock rose 4.4%.
Market News
Fed’s Waller Backs More Rate Cuts, Says He Doesn't Think Proposed Trump Tariffs Will Spark Inflation
Federal Reserve Governor Christopher Waller said Wednesday that he doesn’t think that proposed import tariffs from the incoming Trump administration will lead to upward pressure on inflation.
Tariffs are taxes on imports and most economists think that they will result in higher prices on American consumers.
Waller didn’t disagree, but said any prices rises will not have “a significant or persistent effect on inflation.”
“They are unlikely to affect my view of appropriate monetary policy,” he added.
Trump Mulls National Economic Emergency Declaration to Allow for New Tariff Program, CNN Reports
U.S. President-elect Donald Trump is considering declaring a national economic emergency to provide legal justification for a series of universal tariffs on allies and adversaries, CNN reported on Wednesday, citing sources familiar with the matter.
The move will allow Trump to build a new tariff program by using the International Economic Emergency Powers Act, which authorizes a president to manage imports during a national emergency, the report said.
Tesla Poised for $1 Billion Windfall From EU’s Emissions Curbs
Tesla Motors could collect more than €1 billion ($1 billion) in compensation from rival automakers that need help meeting tougher pollution standards in the European Union this year, UBS Group AG analysts said.
The US company will pool the fleet of electric vehicles it sells this year with at least five other manufacturers, led by Toyota Motor Corp., Stellantis NV and Ford Motor Co., according to an EU document issued Tuesday. The arrangement allows carmakers to average out the emissions of their fleets, with those selling fewer EVs compensating companies like Tesla that over-comply with limits on carbon dioxide emissions.
Absci Rises on $20M Investment by Advanced Micro Devices
Absci Corporation. was rising after a media report on a $20M investment by the semiconductor company Advanced Micro Devices in the AI drug creation company.
ABSI is trading +45% pre-market, while AMD is -1.7%.
ABSI confirmed the investment with the announcement of a strategic collaboration with AMD to deploy the latter's Instinct™ accelerators and ROCm™ software.
Comments