Investing.com – US stock futures hovered below the flatline as traders looked ahead to a speech from US President Donald Trump to business and political leaders in Davos, Switzerland. Elsewhere, Electronic Arts (NASDAQ:EA) cuts its net bookings outlook on weakness at its crucial soccer video game franchise. Nvidia-supplier SK Hynix reports bumper profits amid solid demand from the AI industry for its chips.
1. Futures dip
US stock futures edged down on Thursday, pointing to a easing in stocks after the benchmark S&P 500 touched a fresh record intraday high in the prior session.
By 03:44 ET (08:44 GMT), the S&P 500 futures contract had slipped by 14 points or 0.2%, Nasdaq 100 futures had fallen by 109 points or 0.5%, and Dow futures had inched down by 23 points or 0.1%.
Underpinning Wednesday’s jump in the S&P 500 were technology stocks, with AI-exposed giants like Nvidia and Microsoft (NASDAQ:MSFT) among the biggest gainers. The sector’s best individual performer was Netflix (NASDAQ:NFLX), which reported strong holiday quarter results that were bolstered by a peak in the number of subscribers to the streaming video platform.
Investor appetite for tech names was also whetted by President Trump’s unveiling of a new $500 billion private-sector AI infrastructure investment plan backed by groups like software firm Oracle (NYSE:ORCL), ChatGPT-maker OpenAI, and Japanese conglomerate SoftBank (TYO:9984) — although questions swirled around funding for the project.
Sentiment has been buoyed in recent days by solid US economic data and hopes for cooling inflation, along with a move by Trump to stop short of placing harsh universal tariffs on friends and adversaries alike on the first day of his administration. However, Trump has threatened to slap possible incoming levies on Mexico, Canada, China, and the European Union.
2. Trump to address Davos
Trump is set to deliver a speech remotely to the World Economic Conference in Davos, Switzerland on Thursday, according a meeting schedule cited by Reuters.
The exact topics Trump will cover in his first major speech to global business and political leaders since returning to the White House remain unclear. He is due to speak at 11:00 ET (16:00 GMT), Reuters reported.
Since his inauguration earlier this week, Trump has signed a slew of executive orders that have addressed a wide range of issues, including immigration, diversity, and energy. He has also moved to take the US out of the Paris climate agreement and the World Health Organization, and has said he will push to rename the Gulf of Mexico to the Gulf of America and take back the Panama Canal from Panama.
3. EA cuts net bookings guidance
Shares in Electronic Arts slumped in extended hours trading after the video game maker slashed its guidance for net bookings due to sluggish performance of its soccer titles.
In a preliminary earnings announcement, the company, which develops the “EA SPORTS FC” franchise of games, said the series had been hit by a slowdown despite momentum early in the quarter until December 31 “did not sustain through to the end” of the period.
Separately, its “Dragon Age” offering engaged around 1.5 million players, down by almost 50% from EA’s expectations.
EA subsequently said it now expects net bookings, a measure of net revenue and deferred revenue for games available online, to be around $2.215 billion for the quarter, below its prior projections of $2.4 billion to $2.55 billion.
The announcement comes amid a wave of corporate earnings this week. On Thursday, Union Pacific (NYSE:UNP), Elevance Health (NYSE:ELV), and GE Aerospace (NYSE:GE) are all set to post prior to the market open, while Texas Instruments (NASDAQ:TXN) and CSX Corporation (NASDAQ:CSX) are expected to reveal their latest returns after the bell on Wall Street.
4. Nvidia-supplier SK Hynix’s bumper profits
SK Hynix (KS:000660) posted a sharp increase in its fourth-quarter profit on Thursday, as the semiconductor firm was bolstered by increased demand for high-end chips from the artificial intelligence industry.
Operating profit hit a record high of 8.08 trillion won ($5.64 billion) in the three months to December 31, slightly above Reuters estimates of 8 trillion won. Revenue also jumped by 75% to 19.77 trillion won.
The company is the second-largest maker of memory chips in the world, and beat out rivals Samsung (KS:005930) and Micron (NASDAQ:MU) in bringing advanced high-bandwith memory (HBM) chips into production over the past year.
HBM chips are a key component of AI processors, with SK Hynix serving as a major supplier to AI giant Nvidia (NASDAQ:NVDA). The company has greatly benefited from a ramp-up in AI demand over the past two years, with its investments in increased capacity and advanced chip production now bearing fruit.
5. Bitcoin declines as Trump boost wavers
Bitcoin dipped on Thursday, in a sign that a rally sparked by hype over potentially more crypto-friendly policies under the Trump administration could be fading.
Cryptocurrency markets have taken fleeting support from the Securities and Exchange Commission, which, under new leadership, said earlier this week that it will form a task force to help advise on crypto regulation.
Meanwhile, the president’s token, $TRUMP, which has logged wild price swings since its debut last week, also contributed to additional volatility. The memecoin was down sharply on Thursday.
At the same time, Bitcoin fell 2.8% to $102,356.2 by 03:30 ET (08:30 GMT). The world’s biggest cryptocurrency briefly hit a record high above $109,000 when Trump — who has pledged to be the “crypto president” — was sworn in on Monday.