US stock futures rise as chips gain on Micron results; GDP data ahead
June 26 (Reuters) - U.S. stock index futures rose on Thursday, signaling indexes were nearing their record peaks, as robust earnings from memory-chip maker Micron fueled optimism around artificial intelligence while investors awaited economic data.
The benchmark S&P 500 (.SPX), opens new tab and tech-led Nasdaq (.IXIC), opens new tab were nearly 1% below their record peaks at Wednesday's close, supported by the de-escalation in Middle East hostilities.
Chipmakers tracked a 2.7% premarket rise in Micron Technology shares (MU.O), opens new tab after the company forecast quarterly revenue above estimates, citing growth in demand for its chips used in AI data centers.
Nvidia (NVDA.O), opens new tab advanced 1.2% after scaling a fresh all-time high on Wednesday.
Following Federal Reserve Chair Jerome Powell's congressional testimony where he reiterated a wait-and-watch approach on interest rate cuts, reports suggested President Donald Trump could potentially announce a Fed Chair successor as early as September or October in a bid to undermine Powell.
The move could affect the central bank's independence at a time when policymakers are striving to balance the risk of slowing growth and higher inflation, as Trump's wide-ranging tariffs and geopolitical turmoil threaten to drive up prices in the short-term.
For the day, investors are focusing on the Commerce Department's final take on first-quarter GDP due at 10:00 a.m. ET, as well as durable goods data for May and initial jobless claims data at 08:30 a.m. ET.
Traders are pricing in about 63 basis points of rate cuts by the end of 2025, with a 70% chance of a 25-bps rate cut in September, according to CME Group's FedWatch tool.
At 05:21 a.m. ET, Dow E-minis were up 93 points, or 0.21% and S&P 500 E-minis were up 18.75 points, or 0.31%. Nasdaq 100 E-minis were up 99.25 points, or 0.44%
Shares of sportswear company Nike (NKE.N), opens new tab edged up 0.8% ahead of its quarterly results due before the opening bell.
Some of the central bank officials scheduled to speak later in the day include Fed Chicago President Austan Goolsbee, Fed Richmond President Thomas Barkin, Fed Cleveland President Beth Hammack, Fed Board Governor Michael Barr and Fed Minneapolis President Neel Kashkari.
On Friday, the Personal Consumption Expenditures (PCE) report - the Fed's preferred gauge of inflation - will be scrutinized to ascertain tariff-induced price changes in the U.S. economy.
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Daily Mail
4 minutes ago
- Daily Mail
How much each NATO country will pay to meet 5% defence spending target
NATO agreed at a summit in The Hague this week to set a defence spending target of 5% of GDP for all its members following months of pressure from US President Donald Trump . The agreement, which seeks to boost defence expenditure in Europe 'back to the levels of the Cold War,' as Finnish Prime Minister Alexander Stubb put it, gives members of the security bloc ten years to hit the new target. It's a major revamp of the way the transatlantic alliance calculates defence spending - and one that many analysts doubt is achievable for several of the bloc's members. Of the 5% of GDP members are expected to earmark for defence in 2035, 3.5% will be dedicated to core military spending, with a further 1.5% dedicated to security-related areas. This includes infrastructure - adapted roads, bridges, ports and airfields needed to host and deploy armies to a battlefield - as well as cybersecurity and broader societal changes and civilian programmes to prepare a population for conflict. According to the new regulations, weapons and ammunition that NATO members supply to Ukraine will be factored into the total spend, making the new target slightly easier to reach. The targets may also be adjusted in 2029. But many European countries have expressed concern that they will struggle to meet 5%. Spain, meanwhile, has openly declared it will not come close to meeting the target, leading Trump to threaten to slap tariffs on Spanish goods to make up for the deficit. The UK's current defence spend is 2.33% of GDP, amounting to almost $81.4 billion. If Britain were required to meet the 5% target today, the Government would need to set aside a whopping $192 billion. Our interactive map below displays the current defence expenditure of all the NATO countries, both as a percentage figure of GDP and in monetary terms. As a comparison, you can also see how much money 5% of GDP equates to today. Following Russia 's annexation of Crimea in 2014, NATO members agreed at a summit in Wales to commit 2% of their GDP to defence to help ensure the alliance's military readiness. A decade later, in 2024 - two years into Russia's full-scale war in Ukraine - only 23 of the bloc's 32 members had managed to achieve the target. Now, they're expected to double down even further. The bloc-wide push to increase defence spending comes amid concerns over Russia's ongoing war in Ukraine and the Trump administration's desire to reduce Europe's dependency on Washington for defence and security as Washington turns its focus to China and the Indo-Pacific. NATO allies dedicate a much smaller share of their economic output to defence than Russia but, taken together, they spend significantly more cash than Moscow. Russia's military spending rose by 38% in 2024, reaching an estimated $149 billion and 7.1% of GDP, according to the Stockholm International Peace Research Institute (SIPRI). The US is still by far the biggest spender on defence overall in terms - forking out a total of $967.7billion, equivalent to 3.38% of GDP. But America falls behind Poland and Estonia in percentage spend. These nations, which share a land border with Russia or its exclave Kaliningrad, contribute 4.12% and 3.43% of their respective GDPs to defence. The UK by comparison spends around $81.4billion, equivalent to 2.33% of its GDP, with Sir Keir Starmer 's government insisting it is on a 'path' to increasing this to 2.5%. But no member of the alliance is close to spending 5% of GDP on defence at present, and some nations - including Spain , Canada , Italy and Portugal - are still lagging below the 2% threshold. Spain is at the bottom of the pile, spending just 1.28% as of this year. For Madrid, spending 5% of GDP on defence would mean boosting its annual defence budget by around €80 billion - nearly half the size of the Spain's entire pensions bill - a move the government is unwilling to accept. NATO countries spent over $1.3 trillion on core defence in 2024, up from about a trillion a decade earlier in constant 2021 prices. If NATO states had all spent 3.5% of GDP on defence last year, that would have amounted to some $1.75 trillion - in other words, hundreds of billions of dollars more. Besides the focus on defence spending targets, NATO leaders in The Hague this week reaffirmed their 'ironclad commitment' to the alliance's collective defence clause, Article 5. In recent months, Trump had sowed seeds of doubt about whether the US would actually come to the aid of any NATO ally under attack, conditioning American military support on whether said ally was contributing enough to defence spending. With NATO's new spending pledge in the bag - albeit with Spain's refusal to meet it - a positive Trump told reporters that 'I left there saying that these people really love their countries. 'It's not a ripoff. And we're here to help them protect their country.' It was clear that this week's NATO summit had been curated to appeal to the US President, with leaders perhaps having recognised that stroking the former reality TV star and real estate mogul's ego likely constitutes the path of least resistance in their dealings with him. As Trump flew to the Netherlands, NATO Secretary-General Mark Rutte sent a text message gushing about him being on the verge of a great achievement and saying, 'Europe is going to pay in a BIG way, as they should, and it will be your win.' Trump gleefully plastered the message on social media, forcing Rutte to bat down speculation that he was pandering to the President and that his gushing texts made him look weak. Rutte later suffered another gaffe during a press conference with Trump in The Hague. As the US President went on a rant about America's involvement in the Israel-Iran conflict, Rutte quipped that 'sometimes Daddy has to use strong language', in a pointed reference to Trump's use of a forceful expletive in an interview when chastising the arch foes for breaking a ceasefire deal. Trump's appearance at the summit was brief - his engagements were limited and a simple, one-page statement was prepared to keep him happy and focused. The approach seemed to pay dividends. After the meeting, Trump said he had headed into the summit seeing it as a political chore, but left convinced that the assembled leaders love the alliance, their own countries and, mostly importantly, the United States. He called NATO leaders a 'nice group of people' and said that 'almost every one of them said 'Thank God for the United States.' While Western leaders and defence chiefs met in The Hague, China was preparing to host defence ministers from Iran and Russia for a meeting in its eastern seaside city of Qingdao today. China has portrayed itself as a neutral party in Russia's war with Ukraine, although Western governments say its close ties have given Moscow crucial economic and diplomatic support. Russian Defence Minister Andrei Belousov painted a bleak picture of a world seeing 'worsening geopolitical tensions' when he addressed his counterparts at the meeting. 'The current military and political situation in the world remains difficult and shows signs of further deterioration,' he said, according to a Russian defence ministry statement. His Chinese counterpart Dong Jun also framed Thursday's meeting in Qingdao, home to a major Chinese naval base, as a counterweight to a world 'marked by intertwined turmoil and changes'. 'It is all the more important for the Shanghai Cooperation Organisation to play its role as an anchor of stability,' he said, according to state news agency Xinhua. Recent fighting between Israel, Iran and the United States was also likely discussed in Qingdao. Though Russia and China are both seen as allies of Iran, Moscow and Beijing refrained from offering anything more than diplomatic support to Tehran as it came under attack from Israeli warplanes. This lack of support reflects both Russia and China's limited leverage in the region and reluctance to worsen relations with the US, analysts said. 'Public backing for Iran will come in the form of words, rather than deeds,' said James Char, an expert on the Chinese army at Nanyang Technological University in Singapore. 'Other than condemning the US strikes on Iran, Beijing can be expected to continue treading cautiously in the Middle East's security issues and would not want to be dragged into the region's security challenges,' he said. Iran's defence minister will likely 'discuss with China the supply of weapons but I doubt China would agree', said Andrea Ghiselli, an expert in China foreign policy and a lecturer at Exeter University. 'It would be seen as provocative by both Israel... and, even more important for China, the US, with which Beijing is trying to stabilise relations,' Ghiselli said.
Reuters
14 minutes ago
- Reuters
'Shadow' Fed chief would not influence policy debate, Goolsbee tells CNBC
WASHINGTON, June 26 (Reuters) - Any move by U.S. President Donald Trump to name a replacement for Federal Reserve Chair Jerome Powell would have no influence on monetary policy while the nominee awaited confirmation, Chicago Fed President Austan Goolsbee said on Thursday. "That would have no effect," Goolsbee told CNBC's "Squawk Box" program, referring to the possibility Trump may name an early nominee to replace the current U.S. central bank chief when his term ends in 11 months in hopes of influencing interest rates in the meantime. "We have a chair of the (Federal Open Market Committee) ... That's Jay Powell. What somebody who is not the chair thinks about monetary policy - they can have whatever opinion they want. We have to go every six weeks and have votes." Trump has become increasingly pointed in calling for the Fed to cut rates, even as most of its policymakers feel the central bank is sidelined until the administration makes final decisions on what level of tariffs it plans to impose, and they can study the impact of those rising import taxes on inflation. In hearings before Congress this week, Powell reiterated that the Fed is prepared to cut rates if the tariffs have no effect on inflation, but that economists broadly anticipate the steep levies imposed so far and still in the offing will raise prices over the course of the year. The effect on inflation "could be large or small. It is just something you want to approach carefully. If we make a mistake people will pay the cost for a long time," Powell said. Since the Fed held rates steady at its meeting last week, several central bank officials have said they agree it is best to wait on rate cuts; Fed Vice Chair for Supervision Michelle Bowman and Fed Governor Christopher Waller, both Trump appointees, have said rates could be cut as soon as the July 29-30 meeting, given recent moderate inflation readings. Waller was mentioned in a recent Wall Street Journal article as a possible replacement for Powell, with the added benefit to Trump that he already has a vote on policy and relationships among his colleagues built since joining the Fed's Board of Governors in January 2020. Other possible nominees mentioned by the media include former Fed Governor Kevin Warsh, who has close ties to the Trump organization and was almost named central bank chief in the president's first term in the White House, as well as Kevin Hassett, who is the director of the White House's National Economic Council, and Treasury Secretary Scott Bessent. The debate is playing out amid both ambiguous data and increased political focus on Powell. Recent inflation readings have been better than expected, but many companies insist prices will rise. The unemployment rate remains low. But data released on Thursday showed the overall economy shrank more than initially estimated in the first quarter after consumer spending was revised lower, weakening a key economic prop cited by policymakers who feel there is little risk in delaying rate cuts. Meanwhile, the dollar has dropped amid talk of the "shadow" Fed chief idea and the possible implications for U.S. central bank independence. "Trump's desire to 'shadow' the Fed using a designated replacement for Chair Jay Powell isn't a good way to promote the perceptions of integrity and autonomy in U.S. policymaking and, by extension, that of the reserve currency status of the USD (U.S. dollar)," said Thierry Wizman, global FX and rates strategist at Macquarie Group. "Some of this narrative is seeping into perceptions of the USD and contributing to its sell-off this week." Trump recently said he would name Powell's replacement "soon." Speaking at a NATO summit in Europe on Wednesday, the president said his list of possible nominees was down to "three or four." Those comments have renewed speculation Trump might name a successor early and hope that a chair-in-waiting, or "shadow" Fed chief, could have an immediate impact on rates. Absent an unforeseen resignation and except for Waller, a sitting governor, Trump's nominee could not join the Fed's board until early next year when there is an expected vacancy. Powell's term as Fed chief does not end until next May, and a recent Supreme Court decision appeared to insulate him from being fired over a policy dispute - a fact that could limit Trump's ability to reshape the central bank before his second and final term ends in January 2029.
The Sun
41 minutes ago
- The Sun
WhatsApp users cry ‘I DON'T want this' as new feature is added that goes into private chats
WHATSAPP users have blasted a new in-app feature which uses private data from chats - claiming the tool is unnecessary and unreliable. The Meta-owned app is rolling out a new tool that can whip up a rundown of missed messages with AI - saving users from scrolling through texts. 2 But many have slammed the feature, with some saying that no one had asked for it, and others claiming its analysis of chats would not be accurate. The feature uses Meta AI to scan chats and spit out a bullet point summary of all unread messages. Footage showing the feature in action showed how the tool is activated by tapping the button that normally lets you go through all your unread messages. But instead of just showing the texts, the app generates a short summary of the key points. It is designed to help people quickly catch up on busy group chats or missed conversations. The feature uses Meta's Private Processing technology. According to the tech giant, neither Meta nor any third parties can will be able to see the messages analysed by the AI summary. The summaries are also kept private within the chat, meaning no one else in the group can see them. The AI message summaries are optional and turned off by default. So the feature will not run automatically unless users switch them on manually. WhatsApp is closing down on three mobile devices in hours with users blocked from sending and receiving messages And for users that do not want anyone in a group using summaries at all, WhatsApp includes an Advanced Privacy setting to block it. Social media users raged online, expressing concern over how accurate these summaries would be. One WhatsApp user said: "Who is asking for this?" Another raged: "I've really got to get my family members onto Signal." Some seemed more hopeful for the addition, with one user saying: "It is opt-in and it is a legitimately useful feature for busy group chats." Addressing data concerns, the user added: "Sure, you could've copy-pasted all the messages into an LLM manually and let it summarize everything, Meta simply makes it easier." It comes after Apple's own AI recaps were called out for being inaccurate on several occasions. Meta has been piling AI tools into WhatsApp over the past year. The new features include the ability to ask Meta AI questions straight from a chat. Another recent update allowed users to generate images in real-time using AI. And some users have complained that they have been unable to get rid of a new Meta AI button in the bottom-right corner of the app. Others have slammed the app for bringing ads to the platform - despite its founders previously pledging that they would never want to see this. Meta insists its Private Processing tech creates a "secure cloud environment" for using AI tools - which will not compromise privacy. The firm will not be able to see users' messages or their AI summaries, they said. The AI message summary feature is rolling out in the US and only available in English. But the company said it planned to come to more countries - including the UK - and in different languages later this year. 2
