US stock futures were in a holding pattern on Thursday as investors paused to assess the optimism around AI and interest-rate cuts that has buoyed markets amid the government shutdown.

S&P 500 futures (ES=F) were little changed, coming off another record close for the broad benchmark on Wednesday as Wall Street returned to rally mode. Contracts on the Dow Jones Industrial Average (YM=F) and on the tech-heavy Nasdaq 100 (NQ=F) also drifted just below the flat line.

Meanwhile, the torrid rally in gold (GC=F) showed signs of faltering amid profit-taking, even as it held near record territory above $4,040 an ounce.

The mood is muted as the ongoing federal shutdown puts paid to scheduled data releases, including the jobless claims update due Thursday. That has put the focus more firmly on coming earnings, watched for insight into the economy's health and to test high-running hopes for an AI boom.

PepsiCo (PEP) eked out quarterly profit and revenue beats, ushering in the third-quarter earnings season, which kicks off in earnest with big bank reports next week. Delta Air Lines (DAL) results are also on Thursday's docket.

Investors will also listen out for what Chair Jerome Powell has to say at an event later, after minutes from the Federal Reserve’s September policy meeting out Wednesday boosted spirits. The minutes confirmed that most officials agree that at least two more rate cuts are likely this year.

Taiwan Semiconductor Manufacturing Co. (TSM, 2330.TW) posted a 30% rise in third-quarter revenue on Thursday, topping Wall Street estimates.

The jump in sales at TSMC came as Big Tech companies continue to pile into multibillion-dollar bets on AI. The world's biggest contract chipmaker is the go-to partner for AI accelerator designers such as Nvidia (NVDA) and AMD (AMD), as well as a partner to Apple (AAPL).

Reuters reports:

Revenue for July-September came in at T$989.92 billion ($32.47 billion), according to Reuters calculations, compared with T$759.69 billion in the year ago period.

The latest result handily topped an LSEG SmartEstimate of T$973.26 billion drawn from 22 analysts, and was in the mid-point of guidance of $31.8 billion to $33 billion issued by TSMC in July in its last earnings call. TSMC only gives guidance in U.S. dollars. ...

The company, whose customers include Nvidia and Apple, has been a major beneficiary of advances in AI, which has more than offset the tapering off of pandemic-led demand for chips used in consumer electronics like tablets.

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Nvidia (NVDA) stock rose 1% before the bell on Thursday following the news that the has approved billions of dollars of Nvidia chip exports to the United Arab Emirates. The licences mark the first permits for Nvidia AI chip sales to the Gulf nation since President Trump took office.

Bloomberg News reports:

The Commerce Department’s Bureau of Industry and Security recently issued the Nvidia export licenses under the terms of a bilateral AI agreement hashed out in May, according to people familiar with the matter, who requested anonymity so they could discuss a sensitive issue.

This is a tangible sign of progress on an agreement announced nearly five months ago, centered on a massive five-gigawatt data center in the Gulf nation’s capital that counts OpenAI (OPAI.PVT) as an anchor tenant. That accord has been the source of significant consternation in Washington, where some officials in the Trump administration and on Capitol Hill have questioned the wisdom of building such a large site outside the US, especially in a place where Beijing has developed significant business and economic ties.

Securing the permits is a top priority for the UAE, where some officials have grown frustrated with what they see as a slow pace of US approvals. AI is among the top priorities for the Gulf nation, which is spending massively on infrastructure at home and overseas.

Underpinning the AI deal is an Emirati promise to invest a whopping $1.4 trillion on American soil over the next ten years, a pledge the Gulf nation has not broken down into specific projects. The US, meanwhile, planned to approve up to 500,000 advanced American AI chips annually, with a fifth slated for Abu Dhabi AI juggernaut G42.

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Gold (GC=F) pulled back after hitting the record mark of $4,000, doubling in value over two years, leading to a number of investors pulling gains out of the asset. The pullback showed that the precious metal is no longer being traded solely as a haven asset.

Bloomberg reports:

Bullion declined as much as 0.7% in early Asia trading on Thursday to around $4,015 an ounce, after closing 1.4% higher in the previous session. Technical indicators show gold’s been trading in overbought territory for the past month, likely leading to some profit-taking by investors following a scorching four-day run.

Meanwhile, some of gold’s haven appeal waned as US President Donald Trump said a peace deal in the Middle East was “very close,” after officials from Israel and Hamas were cautiously positive about the prospect that talks underway in Egypt would bring an end to the two-year war in Gaza.

Gold remains more than 50% higher this year, boosted by a plethora of uncertainties over global trade, the Federal Reserve’s independence and US fiscal stability. Heightened geopolitical tensions have also boosted demand for haven assets this year, while central banks have continued to buy bullion at an elevated pace.

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