Nasdaq 100: Semiconductor Stocks Rally in Pre-Market as Fed Uncertainty Lingers

Chip Stocks Carry the Nasdaq While the Dow Slips

Nasdaq futures climbed 151.50 points, or 0.51%, to 29,620.00 at 11:14 GMT Thursday with chip stocks doing the work. S&P 500 futures added 9.25 points, or 0.12%, to 7,538.00. Dow futures dropped 50 points, or 0.10%, to 52,574.00. The split is the story this morning. Semiconductors are drawing buyers and the rest of the market is stuck between Iran headlines that keep reversing and a Fed that couldn’t agree on what comes next.

The Chip Trade Has Real Money Behind It

The VanEck Semiconductor ETF gained 1.8% in premarket with Micron up 3.4% and Sandisk adding 2.4%. Chip stocks led Wednesday’s session too, and the follow-through Thursday morning tells you the bid is not a one-day event. The Nasdaq is riding one group right now and it’s working. China’s CSI 300 rallied 2.5% overnight. Nobody is selling into this.

Gulf Risk Keeps Repricing but the Market Survived

U.S. strikes on Iranian military targets earlier this week sent oil higher on supply fears around the Strait of Hormuz. Then President Trump said he’d contacted Iran about a deal and crude gave back the move. A day earlier, Trump said he was done negotiating after another round of attacks. The market is getting whipsawed by headlines that reverse within hours.

“Any assumption of a swift return to normalized Persian Gulf exports is certainly being challenged,” said Mason Mendez, global real assets analyst at Wells Fargo Investment Institute, adding that low global reserves mean further escalation would reinforce a higher risk premium in oil even after talks resume.

“These renewed geopolitical risks could fuel near-term risk-off sentiment, however, trends of strong equity earnings momentum and ongoing AI strengths will likely continue to drive the S&P 500 Index towards our year-end target range of 7,800 to 8,000,” Mendez said.

The Fed Couldn’t Agree and That’s the Signal

Wednesday’s FOMC minutes told you the committee is split. The vote to hold at 3.5% to 3.75% was unanimous but the discussion wasn’t. Hawks want to hike if prices stay hot. Doves want to wait. Next week’s CPI breaks the tie.

“If we can tease out any forward guidance from the minutes, it would be the committee is working through a wide range of scenarios and will not commit to a specific scenario until the incoming data provides necessary clarity,” said Jeffrey Roach, chief economist at LPL Financial.

PepsiCo’s second-quarter numbers backed that up.

Results were tempered in the quarter as U.S. food and beverage category performance moderated with consumer budgets tightening due to rising inflationary pressures,” CEO Ramon Laguarta said. North American food and beverage demand weakened while international held up.

Daily September E-mini S&P 500 Index Futures Technical Analysis

September E-mini S&P 500 Index futures are edging higher early Thursday after holding the 50-day moving average at 7496.25 the previous session. Traders are now navigating the short-term retracement zone at 7493.00 to 7540.50 that should determine its direction today.

Our bullish scenario has the market holding above 7540.50, and creating the upside momentum needed to challenge the swing top at 7602.50. Taking out this level will put the index in a position to challenge another main top at 7648.75 and the record high at 7693.75.

Crossing below 7493.00 will put the index in a weak position. This could lead to increased selling pressure, putting the main bottom at 7357.25 back on the radar.

Daily Nasdaq Composite Technical Analysis

The Nasdaq Composite is expected to firm on the cash market opening. The failure to breakdown under 25630.51 on Wednesday is fueling today’s early short-covering rally.

The first objective for traders today is the 50-day moving average at 25989.74. Overcoming this indicator should lead to a test of the short-term retracement zone at 25870.65 to 26346.05. Overcoming this area will be the key to testing the swing top at 26788.62. This is the last potential resistance before the all-time high at 27190.21.

A rejection at the 50-day moving average will signal the presence of sellers. This could reverse early gains, leading to a retest of today’s overnight low at 25526.47. The selling pressure could increase later in the session with the daily chart indicating a clean shot at 25014.86 to 24980.38.

Once again, trader reaction to the 50-day MA will set the tone.

Daily September E-mini Dow Jones Industrial Average Futures Technical Analysis

The pre-market price action on Thursday tells me that the tone in the September E-mini Dow Jones futures market will be determined by trader reaction to the minor pivot at 52674.

A sustained move over 52674 will indicate the return of buyers. If this creates enough upside momentum then look for a near-term test of the all-time high at 53656.

A sustained move under 52674 will signal the presence of sellers. Taking out yesterday’s low at 52343 will indicate that downside pressure is building. This could trigger a further break into the short-term retracement zone at 51882 to 51463. This is the last support before the 50-day moving average at 51229.

What to Watch

Chips are the only sector with clear direction this morning, and that’s enough to keep the Nasdaq in front. The S&P 500 is barely moving and the Dow is red. Iran headlines are reversing too fast to trade around, but the underlying risk to oil supply is real and Wells Fargo’s Mendez sees 7,800 to 8,000 on the S&P 500 by year-end if the Gulf situation doesn’t spiral. The Fed is genuinely data-dependent right now because the committee itself is split down the middle. Next week’s CPI is the print that breaks the tie.

The S&P 500 held the 50-day at 7,496 and needs to clear 7,540 for a push toward the swing top at 7,602. The Nasdaq-100 is testing its 50-day at 25,989 and a hold opens a run at the retracement zone near 26,346. The Dow pivots on 52,674. Above it, the all-time high at 53,656 is in play. Below it, sellers push toward the 50-day at 51,229.

More Information in our Economic Calendar.