U.S. Stocks May Give Back Ground In Early Trading

The major U.S. Index futures are currently pointing to a lower open on Thursday, with stocks likely to give back ground following the upward move seen over the two previous sessions.

Weakness among technology stocks is likely to weigh on Wall Street, as reflected by the 1.1 percent slump by the tech-heavy Nasdaq 100 futures.

The downward momentum among tech stocks comes amid a steep drop by shares of Taiwan Semiconductor (TSM). U.S.-listed shares of the world’s largest contract chipmaker are plunging by 4.4 percent in pre-market trading.

Taiwan Semiconductor is under pressure after reporting better than expected second quarter results but forecasting an increase in capital spending.

“While the case for boosting capacity is clear at a time when there is a large gap between supply and demand, shareholders will want TSMC to retain some discipline even as it looks to meet orders piling up,” said AJ Bell head of markets Dan Coatsworth.

A notable increase by the price of crude oil may also generate some selling pressure, with U.S. crude oil futures jumping back above $80 a barrel.

Crude oil prices are surging after the U.S. launched a new wave of attacks in multiple locations across Iran on Wednesday night and Iran retaliated by launching fresh attacks on U.S. military bases in neighboring Gulf States.

Iran has also threatened to target “all the infrastructure in the region” if President Donald Trump’s follows through on his threats to attack Iran’s power plants and bridges.

After failing to sustain an early move to the upside, stocks fluctuated over the course of the trading session on Wednesday but largely maintained a positive bias before closing mostly higher.

The major averages all finished the day in positive territory, adding to the gains posted during Tuesday’s session.

The Nasdaq advanced 162.22 points or 0.6 percent to 26,269.23, the S&P 500 climbed 28.81 points or 0.4 percent to 7,527.40 and the Dow rose 150.37 points or 0.3 percent to 52,658.64.

The early strength on Wall Street came following the release of a report from the Labor Department showing producer prices fell by more than expected in the month of June.

The Labor Department said its producer price index for final demand fell by 0.3 percent in June after climbing by a downwardly revised 0.6 percent in May.

Economists had expected producer prices to edge down by 0.1 percent compared to the 1.1 percent jump originally reported for the previous month.

The report also said the annual rate of producer price growth slowed to 5.5 percent in June from a downwardly revised 6.0 percent in May.

Economists had expected the annual rate of producer price growth to slow to 6.2 percent from the 6.5 percent originally reported for the previous month.

Following yesterday’s weaker-than-expected consumer price inflation data, the report further eased concerns about the outlook for inflation and interest rates.

“Traders are rapidly retreating from rate-hike bets,” FHN Financial Chief Economist Chris Low. “Fed funds futures see the odds of a hike this month now at 9% and have a hike fully priced in by December. Yesterday, it was September.”

Buying interest remained somewhat subdued, however, as traders kept an eye on the escalating conflict between the U.S. and Iran.

In an interview with Fox News, President Donald Trump threatened to attack Iran’s power plants and bridges next week “unless they get to the table and negotiate.”

Brokerage stocks turned in some of the market’s best performances on the day, with the NYSE Arca Broker/Dealer Index surging by 2.1 percent to a record closing high.

Significant strength was also visible among airline stocks, as reflected by the 1.6 percent gain posted by the NYSE Arca Airline Index.

Software, banking and retail stocks also saw notable strength, while computer hardware, networking and semiconductor stocks showed substantial moves to the downside.

Commodity, Currency Markets

Crude oil futures are jumping $0.90 to $80.50 a barrel after rising $0.26 to $79.60 a barrel on Wednesday. Meanwhile, after falling $17.90 to $4,051.80 an ounce in the previous session, gold futures are sliding $25.10 to $4,026.70 an ounce.

On the currency front, the U.S. dollar is trading at 162.27 yen versus the 162.18 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.1451 compared to yesterday’s $1.1463.

Asia

Asian stocks fell broadly on Thursday even as softer-than-expected U.S. inflation data eased concerns about near-term Federal Reserve interest rate hikes.

Investors weighed escalating tensions in the Middle East after the United States launched a new wave of attacks in multiple locations across Iran on Wednesday night and Iran retaliated by launching fresh attacks on U.S. military bases in neighboring Gulf States, raising concerns over global shipping.

The U.S. dollar stabilized in Asian trading after touching a one-month low. Gold prices fell nearly 1 percent toward $4,000 an ounce as traders focused on inflation risks stemming from higher energy prices and supply disruptions linked to the Iran war.

Brent crude futures were slightly lower below $85 a barrel, but stayed close to one-month highs after Iran said it has no plans for negotiations and remains focused on its defense.

Chinese shares ended sharply lower, a day after data showed China’s economy slowed more than expected last quarter to the weakest in more than three years.

China’s Shanghai Composite Index dove 1.9 percent to 3,882.41, while Hong Kong’s Hang Seng Index surged 1.3 percent to 25,008.60.

Alibaba rallied 3.1 percent and Baidu climbed 2.6 percent after Apple confirmed new AI partnerships in China.

Japanese markets tumbled as heavyweight semiconductor-related stocks declined on concerns over the durability of the artificial intelligence-led rally.

The Nikkei 225 Index plunged 2.8 percent to 66,835.54, while the broader Topix Index settled 1.5 percent lower at 4,028.79. Tokyo Electron, Advantest and SoftBank fell 5-6 percent, while flash memory chipmaker Kioxia Holdings lost 15 percent.

Seoul stocks nosedived as investors offloaded technology heavyweights despite record earnings from Taiwan Semiconductor Manufacturing Company.

The Kospi Index plummeted 6.4 percent to 6,820.60, with Samsung Electronics falling 8.8 percent and SK Hynix losing 11.5 percent.

The Korean won rose for a fifth straight session against the dollar to hit over a two-month high as the Bank of Korea raised interest rates for the first time in 3-1/2 years, aiming to counter persistent inflationary pressure amid the intensifying conflict in West Asia.

Australian markets reversed early losses to end on a flat note. Mining stocks underperformed, with BHP falling 2.3 percent after flagging a decline in copper output in the year ahead.

Across the Tasman, New Zealand’s benchmark S&P/NZX-50 Index dipped 0.2 percent to 13,614.78, marking a fourth straight session loss.

Europe

European stocks have moved mostly lower on Thursday as investors weigh escalating Middle East tensions and monitor mixed earnings updates.

Regional losses remained limited after official data showed the U.K. economy returned to growth in May, driven by the service sector output.

According to the Office for National Statistics, GDP grew 0.1 percent in the month, offsetting a 0.1 percent dip in April, which was the first drop since October 2025. On a yearly basis, GDP advanced 1.3 percent in May.

While the U.K.’s FTSE 100 Index is down by 0.4 percent, the German DAX Index and the French CAC 40 Index are both down by 1.1 percent.

The British pound fell against the dollar, giving up a part of the previous session’s strong gains following reports that Shabana Mahmood, home secretary, is likely to become Britain’s next chancellor.

Delivery Hero shares have fallen as Uber Technologies launched a public takeover offer to acquire the German food-delivery company for €41.50 a share.

TotalEnergies has also slumped. The French oil major said it expects the war in the Middle East to have hit second-quarter output by around 210,000 barrels of oil equivalent a day.

British credit data and technology company Experian has also moved to the downside after maintaining its full-year outlook.

Technology and online grocery group Ocado has also plunged after it confirmed further delays to two fulfilment centers under development.

Mining giant BHP has also slumped after reporting a 5 percent drop in fourth-quarter copper production.

ABB has also tumbled after the Swiss engineering group announced a $5.5 billion deal for British automation firm Rotork. Shares of the latter soared.

Meanwhile, advertising and communications group Publicis Groupe has surged after reporting strong second quarter results and raising its full-year guidance.

German chemicals maker BASF has also adavcned after raising its full-year outlook for EBITDA before special items.

U.S. Economic News

A report released by the Labor Department on Thursday showed first-time claims for U.S. unemployment benefits unexpectedly dipped in the week ended July 11th.

The Labor Department said initial jobless claims fell to 208,000, a decrease of 8,000 from the previous week’s revised level of 216,000.

Economists had expected jobless claims to rise to 220,000 from the 215,000 originally reported for the previous week.

Meanwhile, the report said the less volatile four-week moving average edged down to 214,250, a decrease of 4,750 from the previous week’s revised average of 219,000.

Largely reflecting a surge in sales by motor vehicle and parts dealers, the Commerce Department also released a report on Thursday showing a modest increase in U.S. retail sales in the month of June.

The Commerce Department said retail sales crept up by 0.2 percent in June after jumping by an upwardly revised 1.0 percent in May.

Economists had expected retail sales to rise by 0.3 percent compared to the 0.9 percent increase originally reported for the previous month.

Excluding sales by motor vehicle and parts dealers, retail sales dipped by 0.2 percent in June after leaping by 1.0 percent in May. Ex-auto sales were expected to edge down by 0.1 percent.

A separate report released by the Federal Reserve Bank of Philadelphia on Thursday showed a much bigger than expected increase by its reading on regional manufacturing activity in the month of July.

The Philly Fed said its diffusion index for current general activity soared to 41.4 in July from 10.3 in June, with a positive reading indicating growth. Economists had expected the index to rise to 13.0.

Looking ahead, the Philly Fed said firms continue to expect overall growth over the next six months, although the diffusion index for future general activity tumbled to 34.4 in July from 50.2 in June.

At 10 am ET, the National Association of Home Builders is scheduled to release its report on homebuilder confidence in the month of July. The housing market Index is expected to come in unchanged in July after dipping to 35 in June.

The National Association of Realtors is also due to release its report on pending home sales in the month of June at 10 am ET. Pending home sales are expected to decrease by 0.5 percent in June after surging by 3.8 percent in May.

Also at 10 am ET, the Commerce Department is scheduled to release its report on business inventories in the month of May. Business inventories are expected to rise by 0.3 percent in May after climbing by 0.5 percent in April.

The Treasury Department is due to announce the details of this month’s auction of twenty-year bonds at 11 am ET.

At 12:30 pm ET, Dallas Federal Reserve President Lorie Logan is scheduled to participate in a moderated question-and-answer session at a Fed Listening Tour event.

Kansas Federal Reserve President Jeffrey Schmid is due to speak on the Federal Reserve, monetary policy and the economic outlook before the Federal Reserve Bank of Kansas City Economic Forum at 1:25 pm ET.

At 7 pm ET, Federal Reserve Vice Chair Philip Jefferson is scheduled to speaks on “Navigating Economic Shocks” in a conversation at Stanford University.