Nasdaq Futures Climb as SK Hynix Adds Fuel to Chip Rally; Fed Decision and Big Tech Earnings in Focus

December Nasdaq 100 E-Mini futures (NQZ26) are up +0.40% this morning as stellar earnings from South Korean memory-chip giant SK Hynix fueled optimism in the AI trade, sparking a fresh wave of buying in chipmakers and other AI-related stocks.

SK Hynix surged over +10% in Seoul after the memory-chip titan reported a more than seven-fold jump in quarterly operating profit that topped expectations and announced plans to return an additional $45 billion to shareholders. The world’s second-largest memory-chip maker also reiterated its forecast that the chip shortage will persist through 2030. In addition, executives said the company will invest heavily to expand capacity after selling out of conventional and high-bandwidth AI memory through 2029. The results and outlook eased concerns that the AI spending boom was losing momentum, sparking a rally in Asian chipmakers and other AI-related stocks that later spread to U.S. pre-market trading. Sandisk (SNDK) was up over +4%, Micron Technology (MU) was up more than +3%, and Intel (INTC) was up over +1%.

However, gains in Nasdaq 100 futures were capped by rising oil prices.

Investors are now awaiting the Federal Reserve’s interest rate decision and earnings reports from two of the world’s biggest companies, Microsoft and Alphabet.

In yesterday’s trading session, Wall Street’s major indexes ended in the green, led by gains in the technology sector. Chip and AI infrastructure stocks rallied, with Western Digital (WDC) rising nearly +7% and Microchip Technology (MCHP) gaining more than +5%. Also, Pentair (PNR) surged over +12% and was the top percentage gainer in the S&P 500 after the water-technology company posted better-than-expected Q3 results and revised its full-year revenue growth guidance higher. In addition, United Parcel Service (UPS) climbed more than +5% after the carrier reported stronger-than-expected Q3 results and raised its annual guidance. On the bearish side, Boeing (BA) tanked over -10% and was the top percentage loser in the Dow after the company cut its full-year aircraft delivery target.

Economic data released on Tuesday were mostly better than expected, providing support to equities. The U.S. Conference Board’s consumer confidence index unexpectedly jumped to 91.7 in October, stronger than expectations of 81.2. Also, U.S. durable goods orders rose +1.8% m/m in September, while core durable goods orders, which exclude transportation, increased +0.5% m/m, though both figures slightly missed expectations of +2.0% m/m and +0.6% m/m, respectively. In addition, U.S. September new home sales slipped -0.6% m/m to 676K, but came in above expectations of 651K. Finally, the U.S. August S&P/CS HPI Composite - 20 n.s.a. rose +2.7% y/y, stronger than expectations of +2.6% y/y.

Today, market participants will closely watch the Federal Reserve’s monetary policy decision. The Federal Open Market Committee is widely expected to keep the federal funds rate unchanged in a range of 3.75% to 4.00%, following last month’s rate hike, its first since 2023. Meanwhile, Fed watchers expect another increase at the December meeting, the final one of 2026. U.S. rate futures are currently pricing in an 82.2% chance of a hike. Against this backdrop, Chairman Kevin Warsh will face a delicate balancing act at his post-meeting press conference. Mr. Warsh is unlikely to offer much guidance on December, but may also be reluctant to push back against market expectations for another hike.

Shortly after the Fed decision, investors will turn their attention to earnings reports from Magnificent Seven members Microsoft (MSFT) and Alphabet (GOOGL), due after the closing bell. While both tech giants are expected to post double-digit revenue growth, investors will be particularly focused on their AI spending plans and whether those investments are generating sufficient returns. Other major companies set to report today include KLA Corp. (KLAC), GE Vernova (GEV), ServiceNow (NOW), T-Mobile US (TMUS), FedEx (FDX), and Ford Motor Company (F). According to Bloomberg Intelligence, S&P 500 companies are expected to post an average +25% jump in third-quarter earnings from a year earlier.

On the economic front, investors will focus on U.S. wholesale inventories data, set to be released in a couple of hours. Economists forecast the preliminary September figure to rise +0.5% m/m, matching August’s pace.

The EIA’s Weekly Petroleum Status Report will also be released today. Economists expect crude oil inventories to increase by 0.1 million barrels in the week ended Oct. 23, compared with a decrease of 3.1 million barrels in the prior week.

In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 5.01%, up +0.18%.

The Euro Stoxx 50 Index is down -0.11% this morning as investors digested a slew of earnings reports, with rising oil prices pressuring economically sensitive sectors. Bank stocks were mixed on Wednesday amid a busy earnings calendar, with Standard Chartered (STAN.LN) and Deutsche Bank (DBK.D.DX) gaining after their results, while UBS (UBSG.Z.IX) and Santander (BNC.LN) declined. Technology stocks edged higher, tracking a rally among their Asian peers, though gains were limited amid caution ahead of earnings from Alphabet and Microsoft. A survey released on Wednesday showed that German consumer sentiment weakened slightly heading into November as higher energy costs stemming from the Middle East conflict continued to strain household finances. “Consumers are looking increasingly optimistically at economic developments, but when it comes to their own wallets, scepticism still prevails,” said Rolf Buerkl, head of consumer climate at NIM. Meanwhile, Eurozone government bond yields rose on Wednesday as higher oil prices stoked inflation concerns, with investors focused on the U.K. budget and the Fed’s interest-rate decision. In other corporate news, ASM International (ASM.NA) rose over +2% after the chip-equipment maker raised its 2027 revenue guidance. At the same time, Adyen (ADYEN.NA) tanked more than -11% after the Dutch payments company said it would abandon a midterm profitability target amid higher investment.

Germany’s GfK Consumer Climate Index was released today.

The German November GfK Consumer Climate Index came in at -30.8, stronger than expectations of -30.1.

Asian stock markets today settled in the green. China’s Shanghai Composite Index ($CHSC) closed up +0.91%, and Japan’s Nikkei 225 Stock Index ($NKY) closed up +1.08%.

China’s Shanghai Composite Index closed higher today, boosted by gains in the technology sector. Semiconductor and other AI-related stocks jumped on Wednesday, tracking a rally among their Asian peers fueled by SK Hynix’s blowout earnings. Still, sustaining that momentum after a brutal selloff in the sector will require Chinese AI firms to impress investors with their upcoming earnings reports. Robotics stocks also surged, extending their recent rally driven by expectations of faster mass deployment. Unitree Technology climbed more than +8% ahead of the robot maker’s first quarterly earnings report since its Shanghai listing. Meanwhile, mainland-listed Chinese equities are trading at a 33% premium to their offshore counterparts, the widest gap in nearly 17 months, amid Beijing’s efforts to stabilize its stock markets, according to the Hang Seng Stock Connect China AH Premium Index. Elsewhere, Reuters reported on Wednesday that China’s CXMT plans to begin producing HBM3E, an advanced type of high-bandwidth memory chip used with AI processors, despite having a usable-chip yield of as little as 20%. Investor focus is now on the communique from China’s fifth plenum, a closed-door gathering of the Chinese Communist Party’s Central Committee set to conclude on Thursday. Attention will then shift to China’s PMI gauges for October, scheduled for release on Saturday. Economists expect the manufacturing PMI to hold steady at September’s level, staying in expansion territory, while growth in the non-manufacturing sector is projected to pick up, supported by spending during the National Day holiday.

Japan’s Nikkei 225 Stock Index closed higher today as stellar earnings from South Korean memory-chip giant SK Hynix prompted investors to pile back into the AI trade. SK Hynix announced plans to return an additional $45 billion to shareholders after quarterly operating profit jumped a stronger-than-expected seven-fold, underscoring the resilience of the AI infrastructure buildout. The results sparked a rally in chip and other AI-related stocks across the region. Japanese memory-chip maker Kioxia Holdings jumped over +13%, while tech investor SoftBank Group climbed more than +4%, boosting the Nikkei. Meanwhile, Japanese government bond yields rose on Wednesday as renewed enthusiasm for the AI trade dampened haven demand and investors positioned ahead of the Bank of Japan’s policy meeting this week. The BOJ is widely expected to leave its benchmark rate unchanged at 1.25% when its two-day meeting concludes on Friday, as policymakers assess the impact of last month’s hike on inflation and economic growth. Market participants will scrutinize the BOJ’s quarterly outlook report for updated growth and inflation projections. Reuters reported last week that the central bank could raise its inflation forecast for the next fiscal year, as rising oil prices keep price pressures elevated for longer than previously expected. Attention will also be on Governor Kazuo Ueda’s remarks at his post-meeting press conference for clues on the BOJ’s possible course of action at its December meeting. Ahead of the BOJ’s decision, investors will closely watch Japan’s September industrial production and retail sales figures, along with October Tokyo core CPI. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed up +18.87% at 32.88.

Pre-Market U.S. Stock Movers

Chip and AI infrastructure stocks advanced in pre-market trading on SK Hynix’s blowout earnings. Sandisk (SNDK) was up over +4%, Micron Technology (MU) was up more than +3%, and Intel (INTC) was up over +1%.

You can see more pre-market stock movers here

Today’s U.S. Earnings Spotlight: Wednesday - October 28th

Microsoft (MSFT), Alphabet (GOOGL), GE Vernova (GEV), KLA Corporation (KLAC), Amphenol (APH), ServiceNow (NOW), T-Mobile US (TMUS), Fortinet (FTNT), Automatic Data Processing (ADP), Phillips 66 (PSX), Equinix (EQIX), Agnico Eagle Mines (AEM), Vertiv Holdings Co (VRT), Canadian Pacific Kansas City (CP), O’Reilly Automotive (ORLY), FedEx (FDX), American Electric Power Company (AEP), Carvana Co. (CVNA), Boston Scientific (BSX), TE Connectivity (TEL), Aon plc (AON), Garmin (GRMN), Honeywell Aerospace (HONA), eBay Inc. (EBAY), Ford Motor Company (F), Old Dominion Freight Line (ODFL), Biogen (BIIB), Chipotle Mexican Grill (CMG), GE HealthCare Technologies (GEHC), Raymond James Financial (RJF), Flex Ltd. (FLEX), Otis Worldwide (OTIS), American Water Works Company (AWK), Kinross Gold (KGC), Labcorp Holdings (LH), VICI Properties (VICI), Markel Group (MKL), Arxis (ARXS), Smurfit Westrock (SW), NiSource (NI), HF Sinclair (DINO), GFL Environmental (GFL), Fortive (FTV), International Paper Company (IP), IDEX Corporation (IEX), Clean Harbors (CLH), C.H. Robinson Worldwide (CHRW), Invitation Homes (INVH), Tyler Technologies (TYL), Everest Group (EG), Masco (MAS), Gen Digital (GEN), Mid-America Apartment Communities (MAA), Penske Automotive Group (PAG), Jones Lang LaSalle (JLL), Carlisle Companies (CSL), Alamos Gold (AGI), Antero Resources (AR), Lennox International (LII), Nextpower (NXT), Encompass Health (EHC), Avantor (AVTR), Generac Holdings (GNRC), Sterling Infrastructure (STRL), Service Corporation International (SCI), Glaukos (GKOS), Align Technology (ALGN), Evercore (EVR), Aurora Innovation (AUR), OGE Energy (OGE), Antero Midstream (AM), Littelfuse (LFUS), Murphy USA (MUSA), Houlihan Lokey (HLI), Flowserve (FLS), Eldorado Gold (EGO), Prosperity Bancshares (PB), FormFactor (FORM), Morningstar (MORN), Brinker International (EAT), The Hanover Insurance Group (THG), NewMarket (NEU), Etsy, Inc. (ETSY), AXIS Capital Holdings (AXS), Kirby (KEX), MGM Resorts International (MGM), V.F. Corporation (VFC), Pilgrim's Pride (PPC), WEX Inc. (WEX), Plexus (PLXS), Sprouts Farmers Market (SFM), Churchill Downs (CHDN), Terex (TEX), Jersey Mike’s Subs (JMKE), Impinj (PI), Parsons (PSN), Tenable Holdings (TENB), Cactus (WHD), Patterson-UTI Energy (PTEN), SiteOne Landscape Supply (SITE), UFP Industries (UFPI), The Chefs' Warehouse (CHEF), Franklin Electric Co. (FELE), EPR Properties (EPR), Q2 Holdings (QTWO), MYR Group (MYRG), Meritage Homes (MTH), Universal Display (OLED), Scorpio Tankers (STNG), The St. Joe Company (JOE), Rush Street Interactive (RSI), Mechanics Bancorp (MCHB), Broadstone Net Lease (BNL), Boot Barn Holdings (BOOT), Wingstop (WING), Extreme Networks (EXTR), Bel Fuse (BELFB), Provident Financial Services (PFS), Group 1 Automotive (GPI), Dana Incorporated (DAN), McGrath RentCorp (MGRC), Viking Therapeutics (VKTX), Green Brick Partners (GRBK), Hayward Holdings (HAYW), Urban Edge Properties (UE), OneSpaWorld Holdings (OSW), Benchmark Electronics (BHE), Bel Fuse (BELFA), Four Corners Property Trust (FCPT), Blackbaud (BLKB), Cohu, Inc. (COHU), Pitney Bowes (PBI), Bausch Health Companies (BHC), Diebold Nixdorf (DBD), Merchants Bancorp (MBIN), PC Connection (CNXN), Axogen (AXGN), NeoGenomics (NEO), Porch Group (PRCH).

On the date of publication, Oleksandr Pylypenko did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.