These 8 Items Are Shaping the Stock Market Thursday

These are the early headlines and other items poised to influence the market at the start of trading Thursday. As we share this collection of market drivers, while off their lows last night and early this morning, U.S. equity futures point to a mixed open when stocks begin trading.

Note: Before we get to those 8 key items, a quick programming note. The February Monthly Roundup will be published on Monday, March 2. The reason? Chris’s scheduled interim move has been pulled forward by a day, and the efforts needed to get ready for that are the culprit. Think of it this way, it gives some extra time to fully ruminate on the market in February. It also means that Chris will be out on Monday, but back in the thick of things Tuesday, March 3. 

Now for those 8 key items…

1. Nvidia Corp., the dominant maker of artificial intelligence processors, failed to impress investors with its latest sales forecast, signaling that concerns about an overheated AI economy will continue to dog the company… Fiscal first-quarter revenue will be about $78 billion, the chipmaker said. Though the average prediction was $72.8 billion, some analysts had projected numbers approaching $80 billion, according to data compiled by Bloomberg.

Leading up to Nvidia’s  (NVDA)  quarterly earnings report last night, we shared our concerns that whisper number expectations could be a factor in how the market reacts to the company’s posted results and guidance. We’ll have more to say on this in a more detailed note later this morning, but let’s consider that Nvidia’s data center unit, which accounts for the vast majority of its revenue, delivered $62.3 billion for the reported quarter vs. the average analyst estimate of $60.4 billion. And as we compare that against its guidance for the current quarter, it should be noted that outlook does not factor in data center revenue from China.

2. Salesforce stock dropped in premarket trading Thursday after the software company reported better-than-expected fourth-quarter financials. The cloud pioneer reported fourth-quarter adjusted earnings of $3.81 a share on revenue of $11.2 billion. Analysts surveyed by FactSet were expecting adjusted earnings of $3.05 a share on revenue of $11.19 billion. CEO Mark Benioff said in the earnings release that Salesforce now expects to hit $63 billion in revenue in fiscal 2030 due to the rising demand for agentic AI. That’s above the target of $60 billion the company gave at its investor day in October. (Barron’s)

Even though Salesforce’s  (CRM)  guidance for the current quarter is ahead of consensus top and bottom-line expectations, it’s full-year outlook calls for revenue between $45.8 billion-$46.2 billion. That 10%-11% year over year increase is being described as “underwhelming” when compared with analyst estimates of $46.1 billion. Focusing on that misses that its Agentforce annual recurring revenue reached $800 million in the quarter, up 169% year over -year and up from $540 million in annual recurring revenue the quarter before. It also misses that Salesforce’s remaining performance obligation (RPO) rose more than 21% sequentially to $72.4 billion (up 14% year over year). Those figures add to the thinking that “SaaS-pocalypse” is likely overblown.

3. US secretary of state Marco Rubio has warned that Iran’s unwillingness to discuss its ballistic missile programme with Washington is a “big problem” as the pair met for talks on Thursday aimed at averting American strikes on the Islamic republic. (FT) U.S. envoys Steve Witkoff and Jared Kushner are entering a crucial round of talks over Iran’s nuclear program Thursday with tough demands, under pressure from hawks in the administration and Republicans in Congress not to agree to a deal that could be criticized as soft. In the talks, now under way in Geneva, the U.S. negotiators were expected to make clear Iran must dismantle its three main nuclear sites—at Fordow, Natanz and Isfahan—and deliver all of its remaining enriched uranium to the U.S., officials said. (WSJ)

President Trump’s deadline of March 1-6 to strike a deal with Iran is quickly approaching and the president has threatened military action if it fails to do so. U.S. negotiators were expected to make clear Iran must dismantle its three main nuclear sites—at Fordow, Natanz and Isfahan—and deliver all of its remaining enriched uranium to the U.S. We’ll be monitoring today’s developments but also watching reaction in the energy markets. Fears of a new Middle East war is likely to elevate oil prices, stoking inflation. We will also be watching for signs of disruption to shipments through the Strait of Hormuz.

4. Paramount Skydance’s new management team said Wednesday that while their turnaround plan is proceeding apace, a potential acquisition of Warner Bros. Discovery would be an “accelerant” for transforming the business… (MarketWatch)

Reports indicate Netflix  (NFLX)  CEO Ted Sarandos is visiting the White House today to discuss its bid for Warner Bros. Discovery  (WBD) , but the market is starting to come around to growing likelihood Netflix will either lose the bid or walk away from it. There are still some steps to go beyond Warner continuing talks with Paramount Skydance  (PSKY)  and Netflix’s widow to respond. However, as we’ve discussed, Netflix has walked away from deals before, and if it lost the bid, we would see that removing a few overhangs on the shares.

5. Lowe's forecast full-year sales and earnings below Wall Street estimates, and the company's chief executive said during a conference call that consumer confidence is "subdued given inflationary pressures and overall economic uncertainty." CEO Marvin Ellison said, "a persistent lock-in effect remains in place, keeping housing turnover and new home starts under pressure." As such, he said Lowe's expects "improvement in housing and home improvement markets to be gradual." (Reuters)

We see Ellison’s comments as a reminder that housing demand is as tied to job creation as it is to mortgage rates. In response to his remarks, the public homebuilders as well as suppliers traded off. We’ll continue to keep our eye on the space, but our thinking is we’re likely to see repair and remodel spending improve before we see a meaningful thawing in the homebuilding one.

6. Since the U.S. Supreme Court struck down many of Trump’s tariffs last Friday, dozens of companies have rushed to court to try to get their money back, joining hundreds of others who filed suits in anticipation of the court’s ruling. To date, at least 1,800 companies have filed lawsuits seeking refunds, according to a Wall Street Journal analysis, with more joining the rolls every day. (WSJ)

We don’t expect anything immediate on this front, but the question we’re pondering, should companies be awarded funds, what would they do with it? Odds are they aren’t going to return it to consumers, but subject to the size, it could be used to fund special dividends, buyback programs or potentially M&A activity.

7. Economic data today per TipRanks: Initial & Continuing Jobless Claims (Weekly), EIA Natural Gas Inventories (Weekly).

8. Companies reporting today per TipRanks: AM – Baidu  (BIDU) , Celsius  (CELH) , Gildan  (GILD) , Hertz Global  (HTZ) , Hormel  (HRL) , JM Smucker  (SJM) , Nomad Foods (NOMD), Papa John’s  (PZZA) , Shake Shak  (SHAK) , Warner Bros. Discovery  (WBD) ; PM – Ambarella  (AMBA) , Block  (XYZ) , CoreWeave  (CRWV) , Dell  (DELL) , Elastic  (ESTC) , Intuit  (INTU) , Sweetgreen  (SG) , Tutor Perini  (TPC) , Zscaler  (ZS) .

At the time of publication, TheStreet Pro Portfolio was long NVDA.