Investing.com -- U.S. stock futures edged higher Thursday, with strong results from Micron and positive banking stress tests boosting confidence even after hawkish signals from a slew of major central bankers, including Fed chief Jerome Powell.
By 07:00 ET (11:00 GMT), the Dow Futures contract was up 105 points, or 0.3%, S&P 500 Futures traded 14 points, or 0.3%, higher and Nasdaq 100 Futures climbed 55 points, or 0.4%.
Micron, major U.S. lenders boost sentiment
Sentiment has been boosted Thursday by the release of strong third-quarter results from Micron Technology (NASDAQ:MU), with the chipmaker on Wednesday citing demand for its memory chips from the rapidly-growing artificial intelligence sector.
Additionally, the 23 largest U.S. banks all passed the Federal Reserve’s stress tests, the U.S. central bank announced late Wednesday, an event which usually results in the lenders releasing details about their stock buyback and dividend plans.
This confidence comes with the main equity averages on course to record a strong first half of 2023, with the broad-based S&P 500 up 14% this year to date, the tech-heavy Nasdaq Composite has gained nearly 30% – set to post its best first half since 1983 — while the blue-chip Dow Jones Industrial Average is up just 2% this year.
Powell signals further rate hikes
However, gains are likely to be limited Thursday, after a number of central bankers signaled more interest rates ahead, including Fed chief Jerome Powell, at the European Central Bank’s annual gathering in Sintra, Portugal.
"I wouldn't take...moving at consecutive meetings off the table at all," Powell said, noting "the committee clearly believes that there's more work to do, that there are more rate hikes that are likely to be appropriate".
Futures are now starting to price a one-in-five chance of a second quarter-point rate rise by year-end, while the hopes for any rate cut in 2023 are all but gone.
Economic data dump due
Investors have a lot of economic data to study Thursday, as investors gear up for the next Fed meeting towards the end of July.
The weekly jobless claims are expected to come virtually unchanged from the previous week’s 264,000, indicating that the U.S. labor market remains relatively stable.
The final reading of the first quarter's gross domestic product growth is expected to remain unchanged with annualized growth of 1.4%, while pending home sales are seen growing 0.2% in May.
Nike earnings due
In corporate news, earnings are due from spice company McCormick (NYSE:MKC), business services company Paychex (NASDAQ:PAYX) and drugstore chain Rite Aid (NYSE:RAD), but most eyes will be on the results from athletic apparel maker Nike (NYSE:NKE).
Nike could suffer as demand for the sportswear giant's products from wholesalers such as Foot Locker (NYSE:FL) and Hibbett Sports (NASDAQ:HIBB) wanes in the United States due to still-high inflation.
Oil edged higher after large U.S. inventories fall
Crude prices edged higher Thursday, continuing the previous session’s strong tone after the sharp fall in U.S. crude stocks raised hopes that demand in the world’s largest consumer remains strong.
By 07:00 ET, U.S. crude futures were 0.5% higher at $69.87 a barrel, while the Brent contract rose 0.3% to $74.49 per barrel.
Both benchmarks climbed about 3% on Wednesday after the Energy Information Administration said crude inventories dropped by 9.6 million barrels in the week ended June 23, far exceeding the 1.8-million barrel draw expected.
Additionally, gold futures fell 0.2% to $1,917.70/oz, while EUR/USD traded 0.2% higher at 1.0927.
(Oliver Gray contributed to this item.)