Wall Street Poised To Extend Record Run On Tech Strength, Tesla Soars, GameStop Rebounds: Analyst Says 'Bull Market Has Legs Left'

Futures trading suggests a mixed start on Thursday, with tech stocks potentially helping to weather profit-taking-induced weakness. Broadcom Inc. AVGO and Tesla, Inc. TSLA are likely to lead the tech charge, with the former reacting to earnings release and the latter to the likelihood of shareholders approving CEO Elon Musk’s pay package. Traders may also keep an eye on the producer price inflation report for confirmation regarding a gradual let-up in pricing pressure, and the weekly jobless claims report.

Futures	Performance (+/-)
Nasdaq 100	+0.63%
S&P 500	+0.10%
Dow	-0.30%
R2K	-0.65%

In premarket trading on Thursday, the SPDR S&P 500 ETF Trust SPY rose 0.11% to $541.98, and the Invesco QQQ ETF QQQ traded up 0.66% at $477.27, according to Benzinga Pro data.

Cues From Previous Session:

Tech stocks led the broader market to a fresh high on Wednesday, and the upside was facilitated by a tame inflation reading. The Federal Open Market Committee’s pause decision was widely expected but the dot-plot curve dampened sentiment as it brought down the rate cuts Fed forecasters see for the year down to two or even one. More importantly, the Fed stuck to its data-dependent stance.

The Nasdaq Composite and the S&P 500 indices opened notably higher after the Wednesday inflation report and consolidated their gains for the remainder of the session. Both averages hit intraday and closing highs. The Dow Jones Industrial Average lagged, with the 30-stock blue-chip average squandering its early gain and declining through the session before closing slightly lower.

Interest-rate-sensitive small-cap stocks rallied, sending the Russell 2000 sharply higher.

Index	Performance (+/-)	Value
Nasdaq Composite	+1.53%	17,608.44
S&P 500 Index	+0.85%	5,421.03
Dow Industrials	-0.09%	38,712.21
Russell 2000	+1.62%	2,057.10

Insights From Analysts:

“This bull market has legs left,” said Carson Group Chief Market Strategist Ryan Detrick in a post on X. When the S&P 500 Index was up in November through the following February, the next 12 months have never been lower, said the strategist crunching historical data. The broader gauge was up 14 out of 14 times and the average gain has been 17.4%, he said.

Remember, when the S&P 500 was up Nov, Dec, Jan, and Feb (like '24 was) the next 12 months have never been lower (higher 14 out of 14) and up 17.4% on avg.

Again, there were many clues this year would be a good one for the bulls if you ignored what the economists in bowties were… pic.twitter.com/6yzu0FIbjc

— Ryan Detrick, CMT (@RyanDetrick) June 12, 2024

• The Bureau of Labor Statistics, or BLS, is scheduled to release the producer price inflation report for May at 8:30 a.m. EDT. The headline producer price index may have risen 0.1% month-over-month and 2.5% year-over-year. This compares to the 0.5% and 2.2%, rates recorded for April. The monthly and annual rates of core producer prices are estimated at 0.3% and 2.4%, respectively. This compares to the April readings of 0.3% and 2.4%, respectively.
• The BLS is also due to release the weekly jobless claims report at 8:30 a.m. EDT. The number of individuals claiming unemployment benefits may have come in at 225,000 in the week ended June 8, down from 229,000 in the previous reporting week.
• The Treasury will auction four- and eight-week bills at 11:30 a.m. EDT and 30-year bonds at 1 p.m. EDT.
• New York Fed President John Williams and Treasury Secretary Janet Yellen are scheduled to speak at 12 p.m. EDT.

See also: Best Futures Trading Software

Stocks In Focus:

• Broadcom surged over 13% in premarket following the chipmaker’s quarterly results and the announcement concerning a 10-for-1 stock split.
• Dave & Buster’s Entertainment, Inc. PLAY fell nearly 10.5% on earnings and Oxford Industries, Inc. OXM lost about 3%.
• Signet Jewelers Limited SIG, Adobe Inc. ADBE and RH RH are among the key companies due to release their quarterly results on Thursday.
• Tesla rose over 5% after Musk said the proposals for reapproving his 2018 pay plan and shifting the incorporation to Texas were being vetted by wide margins.
• GameStop Corp. GME gained about 3.7% after Wednesday’s sharp pullback.

Commodities, Bonds And Global Equity Markets:

Crude oil futures could snap a three-session winning streak as they traded down notably, and gold futures also slipped. The 10-year Treasury yield rose 1.7 basis points to 4.312% after it fell over 2% on Wednesday amid the Fed decision.

Bitcoin BTC/USD weakened and traded around $67.5K.

Most Asian markets rallied on Thursday, tracking the strong gains on Wall Street overnight, although the Japanese and Chinese markets retreated. European stocks were markedly weak in early trading following the strong gains they notched up on Wednesday.

Read Next: Fed Chair Powell Tempers Market Excitement: ‘We Want To Gain Further Confidence’ On Inflation

Stocks Photo by Phongphan on Shutterstock