Tech Beats and Healthcare Strength Fuel Premarket Rally as Traders Watch Fed and Inflation Risks
U.S. equity futures pushed higher Thursday morning following a string of strong earnings reports from heavyweight tech firms and major consumer companies. S&P 500 futures gained 0.9%, Nasdaq 100 futures rose 1.26%, and Dow futures added 0.2%, bolstered by sharp moves in Microsoft, Meta Platforms, and several names across healthcare, telecom, and cruise lines.
How Did Meta and Microsoft Earnings Shift Market Sentiment?
Microsoft surged nearly 9% in premarket trading after fiscal Q4 earnings of $3.65 per share and revenue of $76.44 billion, both topping estimates. Azure cloud revenue strength and sustained AI demand helped lift investor confidence, putting Microsoft in striking distance of a $4 trillion market cap.
Meta jumped nearly 12% following Q2 results and a strong Q3 sales forecast of $47.5 to $50.5 billion, above consensus. These results, along with upcoming reports from Apple and Amazon, are helping power Nasdaq futures higher despite recent Fed-related headwinds.
Are Other Corporate Earnings Supporting the Broader Rally?
Several non-tech firms also boosted sentiment. CVS Health climbed 7% after raising its full-year EPS outlook to $6.30–$6.40, up from prior guidance. Comcast rose 6% on stronger-than-expected earnings of $1.25 per share. Norwegian Cruise Line rallied 12% as it reiterated full-year guidance despite revenue slightly missing forecasts.
Elsewhere, CoreWeave added 13% following an upgrade tied to its Microsoft exposure, and Carvana surged 18% after beating both top and bottom-line expectations. Biogen jumped 6% on a strong Q2 beat, while eBay popped 12% after an upbeat outlook.
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See all NASDAQ 100 forecastsHow Is Inflation Data Shaping Rate Expectations?
Traders also assessed June’s PCE inflation data, which slightly exceeded forecasts. Headline PCE rose 2.6% year over year, while core PCE climbed 2.8%, both 0.1 percentage point above estimates. Personal income rose 0.3%, while spending came in slightly below forecasts at 0.3%. Despite steady monthly growth, inflation remains above the Fed’s 2% target.
Following Wednesday’s FOMC decision to hold rates steady, internal dissent from Fed governors Bowman and Waller highlighted lingering uncertainty. While Powell emphasized no decisions for September have been made, persistent inflation may limit the central bank’s flexibility.
What Should Traders Expect Going Forward?
While strong tech earnings are lifting equities in early trade, the market’s elevated valuations and hotter-than-expected inflation suggest gains may face resistance.
Traders will focus on earnings from Apple and Amazon later today, along with labor data due Friday. Continued upside depends on whether corporate strength can offset macroeconomic pressures tied to Fed policy and pricing trends.
Caution remains warranted as inflation and interest rate outlooks remain unresolved.
More Information in our Economic Calendar.
