U.S. stock futures moved modestly higher on Thursday as investors looked ahead to another important inflation reading while assessing a fresh round of technology earnings. Cisco Systems (NASDAQ:CSCO) slipped in after-hours trading despite posting strong results fuelled by artificial intelligence demand, while semiconductor equipment maker Applied Materials (NASDAQ:AMAT) is scheduled to report after the closing bell. Geopolitical uncertainty also remains firmly in focus as the U.S. and Iran offer competing claims over control of the Strait of Hormuz amid stalled negotiations over reopening the strategically important waterway.
U.S. stock futures edge higher
Futures tracking Wall Street’s major indices were slightly positive on Thursday as markets continued to digest July’s inflation figures and recent technology-sector earnings.
By 02:58 ET (06:58 GMT), Dow futures were up 26 points, or 0.1%, while S&P 500 futures gained 6 points, also 0.1%. Nasdaq 100 futures advanced 29 points, equivalent to a 0.1% rise.
Wednesday’s regular session produced a mixed performance across the major U.S. averages. The S&P 500 and technology-focused Nasdaq Composite finished higher, while the Dow Jones Industrial Average recorded a marginal decline.
Investor attention centred on data showing that annual U.S. consumer inflation slowed slightly last month, broadly matching forecasts, although the overall rate remained elevated. The figures strengthened expectations that the Federal Reserve will leave interest rates unchanged at its September meeting rather than raise borrowing costs further to tackle inflation.
Treasury yields moved lower following the inflation release, while the U.S. dollar weakened against a basket of major currencies.
Cisco profit climbs sharply on AI demand
Cisco Systems shares moved lower in extended trading on Wednesday despite the networking equipment company delivering a strong set of quarterly figures.
Analysts cited by Reuters noted that investor expectations had become particularly demanding ahead of the results. Cisco shares have climbed more than 60% this year as the company benefits from surging demand for networking equipment required to support artificial intelligence infrastructure.
Chief Executive Chuck Robbins told the Wall Street Journal that Cisco had not experienced such broad-based demand across its portfolio for three decades. The company has secured billions of dollars in orders from major technology groups that are investing heavily in expanding their AI capabilities.
Robbins described the AI boom as the “fastest-moving technology transition” Cisco has ever experienced, according to the WSJ.
Cisco reported July-quarter profit of $3.86 billion, equivalent to $0.97 per share. Revenue increased to $17.25 billion from $14.67 billion a year earlier, surpassing Wall Street expectations.
For fiscal 2027, Cisco forecast revenue of between $72.2 billion and $73.4 billion, ahead of market projections. AI infrastructure orders from hyperscale customers are expected to reach $7.5 billion.
Applied Materials earnings in focus
Attention in the semiconductor sector is now turning to Applied Materials, which is scheduled to release its latest financial results after Thursday’s closing bell.
According to Bloomberg consensus estimates, the company is expected to report adjusted fiscal third-quarter earnings of $3.42 per share on net sales of $9.02 billion.
For the current quarter, analysts anticipate guidance pointing to net sales of $9.62 billion and adjusted earnings of $3.72 per share.
Rapid investment in artificial intelligence has created growing demand for increasingly sophisticated chips, benefiting semiconductor equipment suppliers such as Applied Materials. Advanced AI processors require greater volumes of silicon wafers as well as increasingly complex manufacturing equipment.
In May, Applied Materials forecast growth of more than 30% in its chip equipment business and an increase of over 50% in packaging revenue during 2026. CEO Gary Dickerson told investors that the company sees “an exceptionally strong foundation for sustained multi-year revenue and profit growth.”
U.S. and Iran dispute control of Strait of Hormuz
Away from earnings, developments in the Middle East continue to influence market sentiment, particularly because of concerns surrounding potential disruption to regional oil supplies.
On Thursday, the commander of an Iranian paramilitary organisation said the Strait of Hormuz was “under Iran’s control,” according to Al Jazeera. The statement challenged U.S. President Donald Trump’s assertion on Wednesday that Washington controlled the strategically important waterway.
Negotiations between Washington and Tehran have stalled again, while both sides continue to give conflicting accounts of control over the strait. Before the war began in late February, roughly one-fifth of global oil supplies passed through the route.
An Iranian source told Reuters that negotiations aimed at restoring a framework peace agreement signed in June had made no progress, with continuing hostilities appearing to have undermined the accord.
Despite the supply uncertainty, benchmark Brent crude futures edged lower on Thursday as concerns about the outlook for global demand partly offset worries over constrained supplies.
U.S. producer inflation data next
Markets will now focus on July’s U.S. producer price index, which could provide further evidence on inflation trends before the Federal Reserve’s September policy meeting.
Following Wednesday’s CPI release, annual producer price inflation is forecast to slow to 4.9% from 5.5%. On a monthly basis, PPI is expected to rise 0.2% after falling 0.3% in June.
Alongside volatility in energy prices linked to the Iran conflict, analysts are likely to examine whether rapid investment in AI infrastructure is contributing to broader price pressures.
With both CPI and PPI figures available, economists will also be able to refine forecasts for the upcoming core personal consumption expenditures price index, one of the Federal Reserve’s preferred measures of underlying inflation.
Cisco stock price
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