June 6 (Reuters) - S&P 500 and Dow futures edged lower in choppy trading on Thursday, after jobless claims data indicated growing weakness in the U.S. labor market, while Nasdaq futures outperformed as gains in AI-favorite Nvidia boosted optimism around the tech sector.
A tech rally on Wednesday drove the S&P 500 (.SPX), opens new tab and the Nasdaq (.IXIC), opens new tab to all-time highs, as a string of weakening economic data boosted bets that the Federal Reserve could start easing policy sooner than previously expected.
Some megacap stocks retreated, including Meta Platforms (META.O), opens new tab, Microsoft (MSFT.O), opens new tab and Apple (AAPL.O), opens new tab down between 0.04% and 0.3% in premarket trading. Tech stocks were the main driver of Wednesday's rally, with the tech sector (.SPLRCT), opens new tab gaining nearly 2.6% as Treasury yields eased.
Chip maker Nvidia (NVDA.O), opens new tab was up 1.3%, after crossing $3 trillion in market valuation in the previous session that saw it overtake Apple as the world's second most valuable company.
Gains in Nvidia and other AI-related players have largely driven Wall Street's rally this year, with the chipmaker accounting for roughly a third of the S&P 500's over 12% year-to-date gains.
"There's just a lot of momentum and high sentiment in the semiconductor space, and while over the intermediate term you'll need to bring some of that into check, in the near term, those types of things can really run," said Ross Mayfield, investment strategy analyst at Baird.
On the data front, jobless claims rose more than expected to a seasonally adjusted 229,000 for the week ended June 1, the Labor Department said, the latest in a string of reports indicating tightness in the labor market is reducing, giving the Federal Reserve more room to cut rates.
The attention has now turned to the crucial nonfarm payrolls report due Friday.
Traders see a 70% chance of a September rate reduction, according to the CME's FedWatch tool, and have priced in about two cuts this year, as per data from LSEG. Forecasters polled by Reuters also expect two cuts.
Some market participants also pointed to growing pressure for the Fed with both the European Central Bank and Bank of Canada beginning easing cycles.
"If you get too much divergences among the major economies, it can start to put pressure on different pockets of the economy...it might make something like a (Fed) September cut a little more obvious," Mayfield said.
At 8:45 a.m. ET, Dow e-minis were down 28 points, or 0.07%, S&P 500 e-minis were down 3 points, or 0.06%, and Nasdaq 100 e-minis were up 5.75 points, or 0.03%.
Among others, Lululemon Athletica (LULU.O), opens new tab leapt 8.7% after beating expectations for first-quarter profit and revenue on Wednesday, as its China-based business helped offset slowdowns in North America.
U.S.-listed shares of Nio (9866.HK), opens new tab dropped 4.7% after the Chinese electric vehicle maker posted a quarterly net loss.
Five Below (FIVE.O), opens new tab slumped 19.9% after the discount store operator trimmed its annual net-sales forecast.
Trading platform Robinhood Markets (HOOD.O), opens new tab rose 1.9% after announcing its biggest-ever deal to buy crypto exchange Bitstamp for about $200 million in cash.
Reporting by Lisa Mattackal and Johann M Cherian in Bengaluru; Editing by Shinjini Ganguli
