US stocks trod water before the bell on Thursday as Wall Street waited for fresh jobs data to help calculate interest-rate odds amid uncertainty about Federal Reserve unity on policy.

Futures on the Dow Jones Industrial Average (YM=F) and the S&P 500 (ES=F) both wobbled along the flat line. Meanwhile, contracts on the tech-heavy Nasdaq 100 (NQ=F) nudged down 0.1%, after the major gauges closed lower for a second day.

Markets are putting the brakes on stocks' recent record-breaking rally amid debate over whether AI fervor is stretching valuations too much. At the same time, the uplift from the Federal Reserve's switch to lowering rates is fading, as signs of division among policymakers dents hopes for another two cuts this year.

The spotlight is now on weekly jobless claims data due later, given Fed officials have highlighted concerns about slowdown in the labor market. Thursday's docket also brings readings on US second quarter GDP, personal consumption, and existing home sales, among other economic data.

That sets the stage for Friday's release of the Personal Consumption Expenditures index, the Fed's preferred gauge of inflation. The PCE print for August is expected to show an easing in price pressures, which could make a case for a shift in rates policy.

In corporates, Costco (COST) is expected to report its quarterly results after the bell on Thursday. Investors expect to see a jump in sales as shoppers pursue deals amid economic uncertainty.

As a former analyst, I love gutsy calls on stocks. My vibe was often to go against the grain where it made sense. Sometimes it worked, sometimes it didn't — it was fun either way.

I have to give Redburn's Alex Haissl a shout out this morning for dropping sell rating on one of the hottest stocks of the year, Oracle (ORCL). Haissl makes a compelling case to take profits in the name in a new 59 page report he shared with me.

Here's his overall thesis:

\\"The market materially overestimates the value of Oracle’s contracted cloud revenues. Its role in single-tenant, large-scale deployments is closer to that of a financier than a cloud provider, with economics far removed from the model investors prize. Our analysis suggests Oracle’s five-year OCI revenue guide equates to roughly $60bn in value—meaning the market is already pricing in a risky blue-sky scenario that is unlikely to materialise. While the market currently fixates on headline figures, we expect attention to shift toward the underlying economics. Combined with subdued non-IaaS growth— which the market appears willing to overlook for now—this sets up meaningful downside risk.\\"

Haissl slapped Oracle with a $175 price target, assuming 42% downside from current levels.

Chinese tech stocks extended their rally on Thursday as investors stayed enthusiastic for the country’s AI developers.

Bloomberg reports:

The Hang Seng Tech Index (HSTECH.HK) climbed 0.9%, led by gains in JD.com Inc. (JD, 9618.HK), the e-commerce giant with ambitious AI plans, and smartphone maker Xiaomi Corp. (1810.HK, XIACF). The index, which tracks Chinese technology companies listed in Hong Kong, is now set for its eighth consecutive weekly advance, the longest winning streak since its inception.

Chinese technology companies have been on a strong upward trajectory, driven by grassroots AI advancements that gained global attention following surprising breakthroughs by startup DeepSeek. The elevated stock momentum marks a sharp reversal from just a year ago, when the sector was weighed down by regulatory crackdowns and a slowing economy. ...

“AI optimism is surely one factor with Alibaba’s confidence in raising capital expenditure yesterday driving positive sentiment across the tech space,” said Vey-Sern Ling, managing director at Union Bancaire Privee. Concerns about value-destructive competition in food delivery and quick commerce appear to be easing, given heightened government scrutiny, he added.

Read more here.