Market Analysis

US stock futures decrease as expected TSMC earnings

Amos Simanungkalit · 17 Oct 202431.3K Views

U.S. stock index futures edged lower in Wednesday's evening trade, with technology shares holding steady ahead of highly anticipated earnings from chipmaking giant TSMC. These results are expected to provide further insight into the artificial intelligence (AI) sector.

Futures stabilized after a positive day on Wall Street, where major U.S. stock indices remained near record highs reached earlier in the week. Strong earnings from the banking sector helped offset weaker-than-expected results from chipmaking leader ASML (NASDAQ).

By 19:07 ET (23:07 GMT), S&P 500 futures slipped 0.1% to 5,880.25 points, Nasdaq 100 futures dropped 0.2% to 20,318.0 points, and Dow Jones futures fell 0.1% to 43,312.0 points.

TSMC Earnings to Shed Light on AI Trends
Taiwan's TSMC (NYSE), the world's largest contract chipmaker, is set to report its earnings for the September quarter before the market opens on Thursday. According to a Reuters survey, TSMC's net profit is projected to surge by 42%, reaching T$300.1 billion ($9.33 billion), driven by strong AI-related demand.

TSMC's recent monthly revenue reports signal a strong performance for the quarter. With key clients like Apple Inc (NASDAQ) and NVIDIA Corporation (NASDAQ), TSMC is seen as a key indicator for the chipmaking industry and has benefited significantly from the AI boom, with its stock price climbing sharply in the past year.

The company's results come shortly after chipmaking equipment maker ASML issued disappointing guidance, which initially weighed on tech and chip stocks. However, the sector regained some ground on Wednesday.

TSMC shares gained 0.9% in after-hours trading, while Nvidia remained steady after a 3.5% gain during the regular session.

Wall Street Near Record Highs Ahead of Earnings and Economic Data
U.S. stock indices stayed close to their recent record levels as the third-quarter earnings season continues. The S&P 500 rose 0.5% to 5,842.47 points, and the Dow Jones Industrial Average gained 0.8% to 18,366.51 points on Wednesday, both just shy of all-time highs. The NASDAQ Composite added 0.3% to reach 18,366.51 points.

Earnings reports from major companies such as Netflix Inc (NASDAQ), Blackstone Inc (NYSE), and Intuitive Surgical Inc (NASDAQ) are expected on Thursday. Next week will feature results from tech giants Alphabet Inc (NASDAQ) and Tesla Inc (NASDAQ), along with several other key U.S. companies.

In after-hours trading, Alcoa Corp (NYSE) surged over 5% after posting better-than-expected earnings.

Attention on Thursday will also be focused on retail sales and industrial production data for further insight into the U.S. economy. Investors are growing increasingly convinced that the Federal Reserve will slow the pace of interest rate cuts in the coming months.