Investing.com - US stock futures advance on Thursday, suggesting equities may be on track to add to gains logged in the previous session. Investors are gearing up for more economic data and bank earnings after sentiment was bolstered by cooler-than-projected core consumer price numbers and strong results from large US lenders. Meanwhile, TSMC reports better-than-anticipated fourth-quarter profit thanks to artificial intelligence-fueled demand for its chips.
1. Futures higher
US stock futures moved higher, pointing to an extension to a surge on Wall Street in the prior session that was sparked by a soft core inflation reading and solid earnings from big US banks.
By 03:30 ET (08:30 GMT), the Dow futures contract had added 61 points or 0.1%, S&P 500 futures had ticked up by 23 points or 0.4%, and Nasdaq 100 futures had gained 123 points or 0.6%.
The three averages all spiked on Wednesday, notching their biggest daily percentage climbs since November 6, as a cooler-than-anticipated measure of core consumer price growth in December bolstered hopes for more Federal Reserve interest rate cuts this year. Fed officials noted that while uncertainty swirls around the policies of the incoming Trump administration, the figure helped the outlook for inflation.
In the wake of the data, the benchmark US Treasury note yield -- which had risen to multi-month highs in recent days, denting the attractiveness of equities -- also dropped. Strong results from major US lenders supported sentiment as well (more below).
2. Retail sales due
Investors will have the chance to parse through a slew of fresh US economic data on Thursday, including gauges of retail sales and manufacturing activity.
Economists expect retail sales to grow by 0.6% month-on-month in December, slowing slightly from an increase of 0.7% in the prior month. In November, the reading rose by more than anticipated, as purchases of online items and motor vehicles indicated momentum in the US economy heading into the end of 2024.
Elsewhere, a monthly factory index from the Philadelphia Federal Reserve is tipped to come in at negative 5.2, an improvement from a prior level of negative 16.4. However, the mark would still be in negative territory, suggesting contraction in manufacturing activity. The outlook for the sector, which makes up more than 10% of the US economy, has been clouded by a lack of clarity around the Fed's monetary policy trajectory as well as President-elect Trump's plans to impose sweeping import tariffs.
A look at weekly initial jobless claims is also due out, with traders eyeing the prospects for labor demand following a blockbuster employment report last week.
3. More bank earnings ahead
On the earnings front, Bank of America (NYSE: BAC ) and Morgan Stanley (NYSE: MS ) are scheduled to be the latest big-name US lenders to report their latest quarterly results.
The numbers, which are set to be unveiled prior to the opening bell on Wall Street, will follow buoyant returns from several of their peers on Wednesday.
JPMorgan Chase (NYSE: JPM ) posted an all-time high annual profit underpinned by a fourth-quarter recovery in markets, while Goldman Sachs (NYSE: GS ) logged its best-ever quarterly income, Wells Fargo 's (NYSE: WFC ) bottom-line figure topped estimates, and Citigroup (NYSE: C ) swung to a profit. Shares in all of these companies closed higher.
Executives at these companies also noted a rise in confidence in the future operating environment, citing expectations that the Trump administration will roll out more business-friendly policies. In particular, Goldman Sachs CEO David Solomon told analysts that there has been an "overall increased appetite for dealmaking" as firms prepare for potentially looser regulations and tax cuts during Trump's second term in the White House.
4. TSMC profit tops estimates
Taiwan Semiconductor Manufacturing Co, also known as TSMC, clocked a higher-than-expected fourth quarter profit on Thursday thanks to artificial intelligence-powered demand for its advanced chips.
The world's biggest contract chipmaker forecast a substantial increase in capital spending for 2025, citing a pick-up in capacity utilization and increased production at its new facilities in the US and Japan.
TSMC's net income surged 57% to T$374.68 billion ($11.60 billion) in the three months to December 31, the company said in a statement. The figure was higher than Bloomberg estimates of T$369.84 billion.
For the first quarter of 2025, TSMC CFO Wendell Huang forecast revenue between $25 billion and $28 billion, citing some softer seasonal trends in smartphone demand and AI investment.
TSMC is also set to ramp up capital spending in the face of more AI demand in the year, with Huang pegging 2025 capital expenditures at between $38 billion-$42 billion, up from $29.8 billion in 2024. About 70% of this will be for advanced processes technologies, TSMC’s biggest revenue earner.
5. Crude muted
Oil prices hovered around the flatline on Thursday, adding to recent highs, driven by a combination of softer US inflation data, new sanctions on Russian oil, and significant drawdowns in US crude inventories.
By 03:31 ET, the US crude futures (WTI) were mostly flat, while the Brent contract traded down by 0.1% at $81.94 a barrel.
Oil prices rose more than 2% on Wednesday, to their highest levels since July, as a benign US inflation report brought expectations of softer monetary policy back into play, potentially boosting economic growth.
Supporting the bullish sentiment, the US Energy Information Administration reported a drawdown in crude oil inventories of 2 million barrels, indicating a tightening of supply.