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Futures up: Dow 0.21%, S&P 500 0.41%, Nasdaq 0.93%
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AMD soars after OpenAI deal
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Tesla up after teasing Tuesday event
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Critical Metals surges on potential Washington stake
(Updates before markets open)
By Niket Nishant and Sukriti Gupta
Oct 6 (Reuters) - Wall Street's main indexes were set to
open higher on Monday, building on last week's gains, as AMD's
chip-supply tie-up with OpenAI became the latest in a series of
AI deals and offset concerns around a prolonged federal
government shutdown.
The equities rally has persisted despite cautious
forecasts and warnings about elevated valuations, especially in
tech, highlighting the extent of investor enthusiasm around AI.
"The dollar amounts around these partnerships and around the
buildout of the infrastructure to support AI are getting to be
really astounding," said Leah Bennett, chief investment
strategist at Concurrent Asset Management.
AMD was the latest catalyst as its OpenAI
deal sent shares of the chip company up 33.2%
premarket.
At 08:16 a.m. ET, Dow E-minis were up 101 points, or
0.21%, S&P 500 E-minis rose 28 points, or 0.41%, and
Nasdaq 100 E-minis were up 232 points, or 0.93%.
The gains came despite the government shutdown stretching
into its sixth straight day.
While the standoff in Washington has delayed the release of
the closely watched nonfarm payrolls report, a slew of
alternative indicators last week pointed to tepid hiring,
reinforcing expectations that the Federal Reserve will cut rates
by 25 bps at its next meeting.
Goldman Sachs expects the military pay date on October 15 to
pressure lawmakers into ending their deadlock. If the shutdown
stretches beyond that date, roughly 1.3 million uniformed
military personnel would go unpaid, the brokerage said.
However, even if a deal is reached, the timeline for
releasing delayed data remains uncertain, increasing the
likelihood that the Fed will be operating with limited
visibility into the economy at its upcoming meeting.
Analysts say that makes the third-quarter earnings
season kicking off next week the true test of the rally. By the
end of October, 68% of companies representing 72% of market cap
will have reported, according to Goldman.
"While the government shutdown is the focus now, earnings
and the Fed will soon take center stage. For as much noise as
there is, these fundamentals are key catalysts for investors,"
said Bret Kenwell, U.S. investment analyst at eToro.
Among stocks, AMD rivals Nvidia ( NVDA ) and Broadcom ( AVGO )
fell 0.8% and 0.5%, respectively.
Crypto stocks gained with bitcoin near all-time
highs. Coinbase Global ( COIN ) rose 2.5%, Riot Platforms ( RIOT )
jumped 5.1% while MARA Holdings ( MARA ) climbed 3.5%.
Tesla rose 2.3% after the electric vehicle-maker
teased an event scheduled for Tuesday on social media platform X
over the weekend.
Critical Metals climbed 63.3% after Reuters
reported President Donald Trump's administration is discussing
taking an equity stake in the development-stage mining company.
Comerica ( CMA ) gained 12.9% after Fifth Third
said it will buy the company in a deal valued at $10.9 billion.
Shares in Fifth Third declined 2%.
(Reporting by Niket Nishant and Sukriti Gupta in Bengaluru;
Editing by Devika Syamnath)