US pre-open: Nvidia's stellar Q2 gives futures a boost

(Sharecast News) - Stocks were expected to extend recent gains on Thursday, as results from tech giant Nvidia smashed expectations with its quarterly results after the closing bell. The S&P 500 was up 0.6% in pre-market trade - following its strongest daily performance since June the day before - while the Dow was flat, but the Nasdaq was tracking 1.6% higher, with Nvidia's results providing a big boost to the tech-heavy index.

The company, a world leader in artificial intelligence computing, is being seen as a bellwether of market sentiment.

Nvidia's shares, which had already jumped 229% so far in 2023, were up 8% in pre-market trade after the group posted an 88% quarter-on-quarter jump in revenue to $13.5bn last night, compared with the $11.2bn consensus forecast. Earnings per share shot up 148% to $2.70, beating the $2.09 forecast.

Meanwhile, the company said it expects to make $16bn in the third quarter, some $3.4bn ahead of analysts' current expectations. It also added $25bn to its stock buyback programme.

"Being an early beneficiary of a megatrend like AI is an enviable and rare opportunity, but bears will be arguing that at some point the valuation will start to appear full. Luckily for Nvidia, a cursory glance would suggest there aren't many bears around," said Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown.

AI-related peers Advanced Micro Devices and Microsoft were also putting in decent gains in pre-market trade.

In other news, all eyes will be on the start of the Jackson Hole symposium as Federal Reserve members gather in Wyoming for their annual conference that lasts until Saturday.

The market will be on the lookout for any comments regarding the near-term outlook for economic growth and inflation, and its impact on monetary policy over the coming months.