US stock futures rose on Thursday as investors bought back into technology shares after a sharp sell-off sparked by the Federal Reserve’s tougher inflation message.
Nasdaq 100 contracts led the rebound, supported by renewed interest in chip names after President Donald Trump said Apple would work with Intel on domestic chip design and production.
The recovery came before Friday’s Juneteenth market holiday, which is expected to thin positioning into the long weekend.
Traders were also weighing lower oil prices, stronger retail sales and a higher probability that the Fed may still raise rates later this year.
5 things to know before Wall Street opens
1. Futures rebound afterWednesday’s sell-off
US index futures pointed higher as investors looked for bargains after the previous session’s drop.
S&P 500 futures gained 0.83%, while Nasdaq 100 contracts advanced 1.32%, signalling a stronger rebound in technology shares. Dow futures also climbed, rising 315 points, or a little over 0.6%.
The bounce suggested traders were not ready to abandon the equity rally, even after the Fed’s projections forced markets to price a more hawkish path.
The Nasdaq and Dow remained on track for a second straight weekly gain before the Juneteenth closure.
2. Intel leads the chip trade
Intel was the standout mover, rising 9.3% in pre-market trading after Trump said Apple had agreed to work with the company to design and manufacture chips in the US.
The announcement sharpened the market’s focus on Washington’s push to rebuild domestic semiconductor capacity.
Apple has been seeking to diversify supply chains, while Intel’s foundry business has been under pressure to prove it can compete more effectively with Taiwan Semiconductor Manufacturing Co.
Other chip-linked names also benefited from the mood, but the wider move looked more selective than euphoric.
Investors are still trying to separate genuine AI and manufacturing winners from stocks that have already run too far.
3. Fed repricing keeps investors cautious
The main restraint remains monetary policy. The Fed held rates steady this week, but Chair Kevin Warsh stressed the need to bring inflation under control.
Policymakers also projected the possibility of higher rates later this year.
Markets are now pricing about a 50% chance of a 25-basis-point rate increase in September, up from 27% on Wednesday, according to CME FedWatch.
“The combination of a new chair regime, hawkish projections, and a wide dispersion of views implies a higher bar for near-term action in either direction,” Mark Haefele, chief investment officer at UBS Global Wealth Management, told Reuters.
4. Oil slide gives bulls some cover
Lower crude prices helped soften the blow from the Fed.
Oil fell to more than three-month lows after the US and Iran released the text of an interim agreement aimed at extending a ceasefire and allowing talks toward a final deal.
Cheaper oil matters for equities because it can ease inflation pressure and support consumer spending.
It also gives the Fed less reason to respond aggressively to energy-driven price shocks, though the central bank’s latest projections show officials remain uneasy.
5. Retail sales and fresh movers add support
May retail sales rose more than expected, helped by spending on autos and gasoline. The data reinforced the view that the US consumer is slowing only gradually, even with inflation still a concern.
Among other pre-market movers, Smith & Wesson rose after stronger quarterly sales, while GameStop gained as traders rotated into high-beta retail favourites.
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