Dow Futures Surge 250 Points After Court Blocks Tariffs, Nvidia Crushes Earnings

• U.S. stock futures surged, with S&P 500 futures up 1.16% to 5,971.75, Nasdaq 100 futures up 1.67% to 21,742.00, and Dow futures up 0.60% to 42,412.00, driven by a court ruling against Trump’s tariffs and Nvidia’s (NVDA) strong earnings.
• The chipmaker reported 73% year-over-year data center revenue growth but warned of an $8 billion sales shortfall next quarter due to U.S. chip export bans to China, though its shares rose over 5% after hours.
• Investors await Best Buy (BBY) and Costco (COST) earnings, alongside key economic data like weekly jobless claims and revised Q1 GDP, as Treasury yields rise and the VIX drops 2.07% to 18.91.

The U.S. stock market is poised for a robust opening on Thursday, buoyed by a combination of judicial pushback against President Trump’s trade policies and a strong earnings report from Nvidia (NVDA), despite looming challenges from export restrictions. Futures tied to major indexes reflect this optimism, with the S&P 500 futures advancing 69 points, or 1.16%, to 5,971.75, Nasdaq 100 futures climbing 358 points, or 1.67%, to 21,742.00, and Dow futures rising 255 points, or 0.60%, to 42,412.00. This comes after a lackluster Wednesday session where the S&P 500 and Nasdaq Composite dipped 0.56% and 0.51%, respectively, and the Dow shed nearly 245 points, or 0.58%. Despite the daily pullback, major indexes remain on track for a five-session winning streak, with the S&P 500 (SPX) up 0.75%, the Dow (DJIA) gaining 0.57%, and the Nasdaq (COMP) rallying nearly 1.21% for the week. The tech sector has been the standout performer, surging over 10% in May.

A pivotal development driving market sentiment is the U.S. Court of International Trade’s ruling on Wednesday evening, which struck down certain global tariffs imposed by President Trump under emergency powers, deeming them illegal. The decision, which the Trump administration can appeal in federal court, has temporarily alleviated concerns about the immediate impact of aggressive trade policies. Investors are closely monitoring the broader implications of Trump’s trade agenda, particularly for retailers like Walmart (WMT), which was recently urged by the president to absorb price hikes tied to new duties. This backdrop sets the stage for Thursday’s earnings reports from Best Buy (BBY) and Costco (COST), which will offer further insight into how retailers are navigating the trade landscape.

Nvidia’s earnings report has also captured Wall Street’s attention, reinforcing confidence in Big Tech’s resilience. The AI chipmaker reported a stellar 73% year-over-year revenue growth in its data center business for the first quarter, surpassing expectations on both revenue and earnings. However, adjusted earnings per share fell short due to the U.S. government’s ban on Nvidia’s H20 chip sales to China, a restriction that the company projects will result in an $8 billion sales shortfall in the next quarter. Despite this headwind, Nvidia’s shares surged over 5% in after-hours trading, signaling investor confidence in its long-term growth. CEO Jensen Huang’s comments during the earnings call underscored the broader geopolitical stakes, noting that U.S. chip curbs are accelerating innovation among Chinese rivals and potentially undermining America’s dominance in AI technology. Huang’s assertion that “China’s AI moves on with or without U.S. chips” highlights the challenges facing U.S. tech firms in the world’s largest AI market.

Beyond corporate earnings, macroeconomic indicators are also in focus. Treasury yields ticked higher, with the 30-year yield rising 0.0350, or 0.708%, to 4.9750, and the 10-year yield increasing 0.063 to 4.5400. The VIX, often referred to as the market’s fear gauge, declined 0.40, or 2.07%, to 18.91, suggesting a calming of market volatility. Gold prices, however, edged slightly lower by $0.30 to 3,321.00. Investors are awaiting key economic data releases on Thursday, including weekly jobless claims and a revised first-quarter U.S. GDP report. The initial GDP data indicated a contraction in economic growth for the first time in three years, a development that continues to shape expectations for monetary policy and economic recovery.

The interplay of trade policy, corporate performance, and economic data underscores the complex dynamics driving markets. Nvidia’s ability to outperform despite export challenges highlights the tech sector’s strength, while the court’s tariff ruling offers temporary relief for industries bracing for cost pressures. As retailers like Best Buy and Costco prepare to report earnings, their ability to manage trade-related costs will be closely scrutinized. With major indexes on pace for weekly and monthly gains, investor optimism appears resilient, though the evolving trade and geopolitical landscape remains a critical factor to watch.

WallStreetPit does not provide investment advice. All rights reserved.

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