Nasdaq 100 Futures Rise 122 Points After SK hynix Posts Record Earnings, With Fed Decision in Focus
Key Facts
Nasdaq 100 futures rose 122 points, or 0.41%, at 04:53 Eastern time on Wednesday, October 28, after SK hynix reported record quarterly revenue as demand for AI memory continued. The South Korean company posted revenue of 104.6155 trillion won in the third quarter, crossing the 100 trillion won mark in a single quarter for the first time. Operating profit was 83.3338 trillion won, while net profit reached 39.7756 trillion won. The announcement came as markets awaited the Federal Reserve’s interest rate decision at the end of its two-day meeting. The futures advance extended gains in technology stocks in the previous session, as investors focused on results from companies linked to AI infrastructure.
SK hynix’s earnings accelerated from the previous quarter, with revenue up 32% and operating profit up 38%, while its operating margin reached 80%. Year over year, revenue rose 328%, operating profit 632% and net profit 216%. The company said higher prices for its main products came amid growing demand for AI memory, and pointed to expanding sales of HBM4 high-bandwidth memory and high-value server products. The Associated Press estimated that operating profit, at about 83.3 trillion won, had increased nearly sevenfold from a year earlier and exceeded market estimates. The company said prices for its main products had risen "against a backdrop of growing demand for AI memory."
The results quickly affected trading in South Korea: SK hynix shares jumped 11.4% to their highest level in two weeks, and the Kospi rose 6.8% to 6,023.73 points at Wednesday’s close. Technology stocks had led the U.S. market in the previous session, with the Nasdaq Composite rising 308.43 points, or 1.2%, to 26,477.81 points on Tuesday. The S&P 500 gained 0.6% in the same session, despite declines in most of its constituent stocks. In early trading on Wednesday, Nasdaq 100 futures rose 132 points, or 0.4%, at 06:06 Eastern time, while Dow futures fell 105 points, or 0.2%. The Associated Press reported that S&P 500 futures were up 0.1% in the morning, while oil prices rose more than 1% as supply concerns resurfaced after an attack on a Saudi refinery.
The bet on demand for computing capacity also extended to a $63 billion financing arrangement announced by financial institutions on October 26 to enable AI capacity for Anthropic using Broadcom technology. The structure covers financing the purchase of AI accelerators and networking solutions from Broadcom for lease to Anthropic; it is not financing directed to Broadcom itself. Deliveries are expected to begin in 2027, under a strategic computing-capacity agreement Broadcom had previously announced. Separately, the Associated Press reported on October 27 that Anthropic had filed for an initial public offering. These developments put chipmakers’ results, infrastructure financing and interest in a startup listing on one track that markets are following as demand for computing grows.
SK hynix said long-term supply agreements cover more than 50% of its production capacity for 2027 and 2028, indicating that a large share of future output is tied to advance agreements. The company also expects HBM4 to become its main product starting in the fourth quarter, with its shipments and revenue exceeding those of HBM3E during that quarter. The company sees the supply-demand imbalance in the memory market continuing through 2030, citing the difficulty of advanced manufacturing technologies and the long time needed to build production facilities. That outlook gives the memory-demand trajectory a horizon beyond current quarterly results, as the market watches for signs that supply can keep pace with the expanding use of AI. These forecasts remain the company’s assessment of the market and do not set a date for a certain outcome.
Investors are awaiting the Fed’s decision on Wednesday, with the Associated Press expecting interest rates to remain unchanged, followed by a news conference by the central bank’s chair. The Fed raised its benchmark interest rate in September to about 3.9% from roughly 3.6%, according to the agency. The meeting comes as consumer price inflation stood at 3.7% year over year in September, compared with 2.4% in February. After its October decision, the Fed will hold its next meeting on December 8 and 9, 2026. The following day, October 29, the U.S. Bureau of Economic Analysis is scheduled to release its advance estimate of third-quarter gross domestic product, adding a new reading on economic activity after the monetary policy decision.