Futures steady, Nasdaq higher as markets await bank earnings

(Reuters) – Dow and remained steady on Wednesday, while rose slightly following a tech and oil stock selloff in the previous session, as investors awaited quarterly results from Morgan Stanley and other banks.

Chip heavyweight Nvidia (NASDAQ:) rose 0.9% in premarket trading, after slumping nearly 5% in the previous session, following a report the Biden administration is considering capping AI chip exports by U.S. companies.

Semiconductor stocks were broadly mixed, with the U.S.-listing of chip equipment-maker ASML Holding (AS:) losing 4% after the company cut its annual sales forecast on Tuesday.

At 5:15 a.m. ET, Dow E-minis were down 30 points, or 0.07%, U.S. E-minis were up 2.75 points, or 0.05%, and E-minis were up 37.25 points, or 0.18%.

Steep declines in semiconductor and oil stocks dragged on Wall Street in the previous session, while investors assessed a mixed bag of earnings. Shares of health insurer UnitedHealth (NYSE:) slumped, offsetting the gains from upbeat results from major banks.

Corporate results are due through the week, along with key economic data including the retail sales and industrial production figures on Thursday, all of which are expected to shed light on consumer health and the growth outlook for the world’s largest economy.

Indexes were trading around record high levels despite Tuesday’s fall, with continued optimism about future rate cuts from the Federal Reserve as well as economic growth buoying sentiment.

“I continue to view dips as buying opportunities, with said downside likely to prove shallow and short-lived in nature,” said Michael Brown, senior research strategist at Pepperstone.

Banks will be in focus on the day, with most big names reporting broadly upbeat results so far. Earnings from companies including Morgan Stanley, Citizens Financial (NYSE:) Group and U.S. Bancorp are due before the bell.

“Providing that banks prove a reliable barometer for earnings season more broadly, solid earnings growth, coupled with resilient economic growth, should continue to power the market higher,” Brown said.

Bets on a 25-basis-point rate cut at the Federal Reserve’s November meeting have risen above 90%, according to CME’s FedWatch.

September import and export prices data is also due later in the day.

Shares of rate-sensitive megacap tech stocks edged higher in premarket trading, helped by easing U.S. Treasury yields. Apple (NASDAQ:) gained 0.2% after touching a record high on Tuesday, while Microsoft (NASDAQ:) and Amazon.com (NASDAQ:) both rose 0.2%.

Shares of Interactive Brokers (NASDAQ:) Group fell 5% after missing estimates for adjusted third-quarter earnings.