(Reuters) – Wall Street futures rose on Friday led by gains in stocks tied to the Nasdaq 100 index as technology stocks rose broadly, while Netflix soared on positive earnings results.
Netflix shares rose 5.8% in premarket trading after the streaming giant said it beat Wall Street’s subscriber growth expectations and expects continued growth through the end of the year.
The so-called “Magnificent Seven” stocks, the main drivers of Wall Street’s gains this year, all rose in premarket trading, with Apple on the back of data showing a surge in new iPhone sales in China. It rose 1.1%.
Semiconductor giant Nvidia rose 1.2%, building on gains in the previous session when semiconductor stocks were boosted by strong results from contract chip maker TSMC.
The Dow E-mini rose 30 points (0.07%), the US S&P 500 E-mini rose 13 points (0.22%) and the Nasdaq 100 E-mini rose 93 points (0.46%).
Meanwhile, the number of listings of Chinese companies in the United States soared after the People’s Bank of China launched a financing program aimed at stimulating the stock market. Alibaba rose 3.7%, Jingtocom rose 5.4% and PDD Holdings rose 5.6%.
Strong earnings from financial companies and generally positive economic data pushed the Dow and S&P 500 to record highs this week. The Dow closed at a record high on Thursday, but there are signs that investors are seeking cheaper corners of the market.
All three major indexes have been on an upward trend for six consecutive weeks, but the Russell 2000 Index is expected to outperform with a 2% increase. Futures linked to the small-cap index rose 0.4%.
At the same time, U.S. Treasury yields have edged higher, with the benchmark 10-year Treasury yield once again above 4.1%, which could put further pressure on stock prices.
“While we expect stock market performance to further improve now that interest rates are being cut, large companies remain well-valued and less sensitive to interest rate changes, so quality remains high,” said Neuberger Berman. “We will continue to favor small and medium-sized enterprises with high performance.” portfolio managers said.
As expectations for corporate performance rise, valuations rise (the S&P 500 index trades at nearly 22 times forward earnings), potentially making stock prices more likely to fall.
Procter & Gamble Co., American Express and SLB are scheduled to report earnings before the bell.
September housing starts will be published in the statistics, and Fed officials Christopher Waller, Neel Kashkari and Rafael Bostic are scheduled to speak on the day.
Expectations that the U.S. Federal Reserve will cut interest rates by 25 basis points at its November meeting have held steady throughout the week, currently at 92.1%, according to CME’s FedWatch.
(Reporting by Lisa Matakkal in Bengaluru; Editing by Pooja Desai)
