Megacaps boost futures as Wall Street stays upbeat ahead of data, earnings
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Powell due to speak at 10 a.m. ET
TSMC up on strong Q2 revenue growth
Illumina rises after acquiring Fluent BioSciences
Goodyear Tire up after report Yokohama's plans to buy unit
Futures: Dow flat, S&P 500 up 0.14%, Nasdaq up 0.27%
Updated at 7:26 a.m. ET
By Lisa Pauline Mattackal and Ankika Biswas
July 10 (Reuters) -S&P 500 and Nasdaq futures rose ina record-breaking Wall Street rally on Wednesday, on continued strength in heavily weighted stocks, withFederal Reserve Chair Jerome Powell's remarks and crucial inflation prints set to offer more direction this week.
AI-chip favorite Nvidia NVDA.O climbed 1.1% in premarket trading, after hitting a near three-week high in the previous session.
Other chip stocks including Arm Holdings ARM.O and Micron Technology gained around 1% each, with U.S.-listed shares of Taiwan Semiconductor Manufacturing Co TSM.N, the world's largest contract chipmaker, climbing 2% after its second-quarter revenue handily beat estimates.
All the so-called "Magnificent Seven" stocks were trading higher, with U.S. Treasury yields falling. Meta Platforms META.O, Apple AAPL.O, Alphabet GOOGL.O and Microsoft MSFT.O were up around 0.4% each.
Tesla TSLA.O, too, edgedup 0.5% after HSBC hiked its price target on the EV maker's stock, whichclocked its longest winning streak of10 sessions this yearon Tuesday.
The group of seven stocks has been the main force behind Wall Street's banner rally this year, while the broader market has lagged, leading some market watchers to question the sustainability of equity gains and call for greaterdiversification.
The benchmark S&P 500 .SPX closed at an all-time high for the fifth straight session on Tuesday, whilethe tech-heavy Nasdaq .IXIC notched its sixth record closing high, after hopes for an interest-rate cut in September received a boost fromJerome Powell, who said theU.S. was "no longer an overheated economy".
However, as expected, Powell refrained from committing to a timeline for rate cuts in his testimony to Congress. He is slated to appear before the House Financial Services Committee at 10 a.m. ET for further questioning from lawmakers.
"We believe Powell is happy with keeping markets relatively quiet at this stage as some data starts to go in the right direction, we did read a still modestly dovish bias in Powell’s testimony, as he kept adding emphasis on the risks of unduly weakening activity and employment," analysts at ING said in a note.
Bets on a 25-basis-point rate cut by September have hovered around 70% for the past week, up from 45% a month ago, according to CME's FedWatch. Comments from Fed officials Austan Goolsbee, Michelle Bowman and Lisa Cook are also expected through the day.
Attention will now shift to U.S. inflation data this week, with the ConsumerPrice Index due on Thursday and the Producer Price Index report on Friday.
The second-quarter earnings season, which kicks off this week with major banks due to report onFriday, will be a key test for whether high-flying megacaps can justify expensive valuations and continue their strong runs.
At 7:26 a.m. ET, Dow e-minis 1YMcv1 were down 4 points, or 0.01%, S&P 500 e-minis EScv1 were up 8 points, or 0.14%, and Nasdaq 100 e-minis NQcv1 were up 55.25 points, or 0.27%.
Gene-sequencing equipment maker Illumina ILMN.O jumped 3.7% on plans to acquire privately held Fluent BioSciences.
Goodyear Tire & Rubber Company GT.O gained 2% aftera report that Japan's Yokohama Rubber was in talks to buy its off-road tire business for at least $1 billion.
Reporting by Lisa Mattackal and Ankika Biswas in Bengaluru; Editing by Pooja Desai
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