Nasdaq, S&P set to rise at open as chips, megacaps rebound
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TSMC rises, lifts chips stocks after upbeat results
Domino's Pizza slumps after Q2 same-store sales miss
D.R. Horton falls after tightening home sales forecast
Warner Bros Discovery jumps on report of mulling break-up plan
Jobless claims higher than expected
Futures: Dow down 0.19%, S&P 500 up 0.25%, Nasdaq up 0.67%
Updated at 8:45 a.m. ET/1245 GMT
By Lisa Pauline Mattackal and Ankika Biswas
July 18 (Reuters) - Nasdaq and S&P 500 futures were on track to open higher on Thursday, as megacaps rebounded and an upbeat forecast from Taiwan Semiconductor Manufacturing lifted chip stocks following a sharp sell-off in the previous session.
U.S.-listed shares of TSMCTSM.N jumped 2.4% in premarket trading afterthe world's largest contract chipmaker raised itsfull-year revenue forecast on surging demand for AI chips. The stock had tumbled in the previous session after comments about Taiwan from Republican presidential candidate Donald Trump.
TSMC's results brought some cheer back to chip and megacap tech stocks, with AppleAAPL.O and Nvidia NVDA.O, both TSMC customers, up0.8% and 3%, respectively.
Other chipmakers such as AdvancedMicro Devices AMD.O, Intel INTC.O, Marvell Technology<MRVL.O> and Arm Holdings ARM.O rose between 0.9% and 2.1%.
The sector was set to rebound after a drastic sell-off in Wednesday's session, which saw chip stocks lose over$500 billion in market value followinga report that theU.S. was considering tightercurbs on exports of advanced semiconductor technology to China, as well as Trump's Taiwan comments.
The Philadelphia SE Semiconductor index .SOX logged its worst day in four years on Wednesday, pressuringmegacap shares.
The group ofso-called "Magnificent 7" stocks rose, with Microsoft<MSFT.O>, Tesla TSLA.O and Meta Platforms<META.O> gaining between 0.5%and 1.5%.
The quarterly earnings season that is underway will be a significant test for whether expensively valued megacaps can keep investors satisfied with strong results.
"Risks in the technology sector got pointed out yesterday, with continuing trade issues between the U.S. and China," said Paul Nolte, senior wealth adviser and market strategist for Murphy & Sylvest.
On the earnings front, Domino's Pizza DPZ.N slumped12.1% after falling short of estimates for quarterlysame-store sales, while homebuilder D.R. Horton DHI.Ndropped 2.2% after the homebuilder tightened its annual forecast for home sales.
Thesmall-cap Russell 2000 index was set to open lower for a second day, withfuturesdownRTYcv1 0.4%. The index fell 1% in the previous session, snapping a five-day winning streak.
Despite the pullback, Nolte said he expects the rotation from large tech stocks to small-cap and value companies to continue, although "not in a straight line".
Dow futures also slipped after the index notched its third consecutive closing high on Wednesday.
Elsewhere, the Labor Department reportedjobless claims rose to 243,000 for the week ended July 13 - higher than previously forecast - another signal that the jobs market was cooling.
Traders are pricing in a 93.5% chance of a 25-basis-point rate cut from the Federal Reserve by September, according to CME's FedWatch.
Comments from Fed officials Lorie Logan, Mary Daly and Michelle Bowman are also expected later in the day.
At 8:45 a.m. ET, Dow e-minis 1YMcv1 were down 77 points, or 0.19%, S&P 500 e-minis EScv1 were up 14.25 points, or 0.25%, and Nasdaq 100 e-minis NQcv1 were up 133 points, or 0.67%.
Warner Bros Discovery WBD.O jumped7.0% after a report that the CNN and HBO owner had discussed aplan to split its digital streaming and studio businesses from its legacy TV networks.
Shares of NetflixNFLX.O rose0.4%, ahead ofresults expected afterthe closing bell.
Reporting by Lisa Mattackal and Ankika Biswas in Bengaluru; Editing by Shounak Dasgupta and Pooja Desai
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