US Stock Futures Advance as Strong AI-Linked Earnings Continue

US stock futures advanced as another round of strong earnings from artificial intelligence-linked companies buoyed sentiment on Wall Street following a turbulent July.

Palantir Technologies gained 16% in premarket trading after again raising its annual revenue forecast, while chipmaker On Semiconductor added 7.6% after forecasting quarterly revenue above expectations.

Caterpillar, seen as a bellwether for the global industrial economy, jumped 7.5% after reporting a second-quarter profit that nearly doubled from a year earlier.

Investors have been scrutinising results from AI-linked companies this earnings season for signs that their billion-dollar investments are yielding returns. Strong results from AI leaders Microsoft and Amazon last week were a relief and have underpinned gains.

"Momentum-driven sectors often overshoot in both directions. But it is important not to confuse a momentum unwind with a fundamental deterioration," said Brian Levitt, chief global market strategist at Invesco.

The benchmark S&P 500 is about 21 points from hitting its first record high since June, while the blue-chip Dow closed at a record high on Monday for the first time since July.

At 6.56am, Dow E-minis were up 343 points, or 0.64%, S&P 500 E-minis were up 15.5 points, or 0.2%, and Nasdaq 100 E-minis were up 225 points, or 0.78%.

Other AI-linked stocks also gained, with Micron adding 3.5%, Nvidia rising almost 1% and Marvell climbing 8.5%. Of the 304 S&P 500 companies that had reported second-quarter earnings as of Friday, 85.2% beat estimates, versus a long-term average of 67.5%.

Elon Musk's SpaceX will release its first earnings report since its public debut after markets close, with shares up 1.3%. Snap jumped 6.8% after beating revenue estimates, helped by increased advertising spending during the Fifa World Cup and stronger campaign activity from large North American advertisers.

Photonic firms Coherent and Lumentum added 11.8% and 9.3% respectively after Reuters reported the Trump administration is drafting a ban on US imports of new models of Chinese data centre components.

Attention later shifts to economic data. The Labor Department's Job Openings and Labor Turnover Survey is expected to show about 7.4 million jobs in June, down from 7.6 million. Traders see a 63.4% chance the Federal Reserve will hike rates by at least 25 basis points next month, the CME FedWatch Tool showed, with the US-Iran standoff keeping crude prices elevated.