Futures tracking the S&P 500 and the Dow edged up on Wednesday on hopes of a Middle East peace breakthrough, while ones tied to the Nasdaq lagged as upbeat forecasts from SpaceX and AMD failed to impress investors.
Elon Musk-led SpaceX's (SPCX.O) revenue nearly doubled and operating losses narrowed in its first earnings report since going public, fueled by its booming Starlink satellite communications and AI businesses.
But the rocket company's shares slid 11.7% in premarket trading after executives flagged the spending spree underpinning its lofty ambitions was far from over. Shares could face additional pressure from the expiry of the stock's post-IPO lock-up period starting on Thursday. Musk's other company, Tesla (TSLA.O), slipped 1%.
"This is the culmination of the story of this entire earnings season. SpaceX beat analysts' expectations on revenue, but spending on AI is getting out of hand, with no signs of slowing down anytime soon," said Nic Puckrin, cross-asset analyst and founder of Coin Bureau.
Advanced Micro Devices (AMD.O) forecast quarterly revenue above estimates, reflecting strong AI demand. However, shares slipped 9.2%, suggesting investors were looking for a stronger outlook to justify the stock's 142% jump this year.
Rival Nvidia's shares (NVDA.O), which have lagged AMD this year, rose 2%, also underpinned by SpaceX's plans to use the company's hardware exclusively to build its data centers.
Other chip stocks such as Intel (INTC.O) and Micron lost more than 2% each, while megacaps Microsoft (MSFT.O) and Alphabet (GOOGL.O) were steady as Wall Street took a breather from a rally spanning the past few sessions that took the benchmark S&P 500 (.SPX) and the blue-chip Dow (.DJI) to record highs.
Other sections of the market, however, were doing well, with drugmaker Eli Lilly (LLY.N) up 4.2% after raising its full-year revenue forecast, while Disney (DIS.N) rose 4.5% after beating third-quarter profit expectations.
Arista Networks (ANET.N) jumped 13.3% after the networking equipment maker forecast third-quarter revenue above estimates.
At 6:54 a.m. ET, Dow E-minis were up 202 points, or 0.37%, S&P 500 E-minis were up 31.5 points, or 0.41% and Nasdaq 100 E-minis were down 4.25 points, or 0.01%.
The focus is also on a private national employment survey due at 8:15 a.m. ET that could offer clues on how the jobs market fared in July, ahead of the official non-farm payrolls figures on Friday.
A survey on services sector activity during the previous month is also due at 10 a.m. ET.
Data has broadly reflected robust economic performance, but with Middle East tensions keeping energy costs elevated and the Federal Reserve offering no forecasts on monetary policy, uncertainty persists.
Kansas City Fed President Jeff Schmid, a non-voting member on the Federal Open Market Committee, said late on Tuesday that some sort of monetary policy tightening is needed to get "too high" inflation back to the 2% target.
Remarks from Governor Lisa Cook and San Francisco Fed President Mary Daly will be scrutinized for their perspectives on interest rates.
Traders are pricing in a 58.4% chance of a rate hike in September, the CME Group's FedWatch Tool showed.
