US stock futures advance as strong AI-linked earnings continue
Investors have been scrutinising results from AI-linked companies this earnings season for signs that their billion-dollar investments are yielding returns.
US stock index futures climbed on Tuesday as strong forecasts from Palantir and ON Semiconductor boosted investor confidence in AI-driven demand. Palantir Technologies surged 16% premarket after raising its annual revenue forecast, while chipmaker On Semiconductor jumped 7.6% after predicting quarterly revenue above expectations.
Caterpillar also rose 7.5% after reporting a second-quarter profit nearly double the previous year. Investors are closely examining the earnings of AI-linked companies this season to gauge the returns on their investments. Microsoft and Amazon's strong results last week provided a relief and have supported gains on Wall Street following a turbulent July.
The S&P 500 is within 21 points of its first record high since June, and the Dow Jones Industrial Average reached a record high on Monday for the first time since July. Other AI-linked stocks, such as Micron Technology, Nvidia, and Marvell, also gained. Overall, this earnings season has outperformed historical standards, with 85.2% of the 304 companies in the S&P 500 that reported Q2 earnings as of Friday beating estimates.
Investors will soon focus on economic data, including the Labor Department's Job Openings and Labor Turnover Survey and reports on factory orders and trade for June, as well as remarks by Kansas City Fed president Jeffrey Schmid. The market anticipates a 63.4% probability of a rate hike by at least 25 basis points when the Federal Reserve meets next month.
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