Nasdaq futures are on the rise on Monday, signaling a positive start to June for US stocks. The optimism is fueled by hopes for rate cuts and a resurgence in meme-stock mania.
Contracts for the Nasdaq 100 and S&P 500 are up 0.4% and 0.2%, respectively, with tech giant Nvidia leading the charge with a 3% jump after announcing an AI chip update. However, Dow Jones Industrial Average futures are lagging behind.
The spotlight is on GameStop, as the stock surged over 100% in pre-market trading following a Reddit post by influential trader Keith Gill, also known as “Roaring Kitty.” This has reignited speculation of a meme rally similar to the one seen in 2021, with fellow meme darling AMC also seeing a 20% increase in its shares.
Overall, stocks are poised to continue their strong performance from May, with all three major indexes breaking records last month. The positive sentiment is further boosted by recent PCE data suggesting a possible turnaround in inflation, leading to hopes for a Federal Reserve rate cut.
Investor focus will now turn to the upcoming labor market reports later in the week, which will provide insight into the Fed’s future actions. Traders have increased their bets on a Fed rate cut in September, according to the CME FedWatch tool.
In the tech sector, Nvidia’s gains hint at a resurgence in AI enthusiasm, with rival AMD also seeing a bump in its stock price after unveiling its own AI platform. The positive sentiment in the tech industry is further supported by Nvidia’s recent presentation at Computex in Taipei, where it unveiled its next generation of AI chips.
As the market gears up for a potentially volatile month, investors are advised to stay cautious and do their research, especially in the meme-stock space. The week is off to an exciting start, with GameStop’s explosive growth setting the tone for what could be a rollercoaster ride ahead.
