Nasdaq futures surged on Micron's historic beat, but with core PCE running well above the Fed's 2% target and a rate hike now on the table, Thursday's inflation print could make or break the AI-fueled recovery.
Micron Technology, Inc.’s (MU) shares are poised to reach a new record high after the AI memory chipmaker reported stellar quarterly results. The optimism surrounding AI fundamentals proved contagious, lifting other AI-exposed stocks and boosting index futures. Micron stock was last up more than 16% at 1,217 in premarket trading, surpassing its previous record high of 1,213.56 set on June 22.
Nasdaq-100 (NQ) futures climbed more than 2% ahead of Thursday’s market open, while E-mini S&P 500 futures tied to the broader S&P 500 Index (SPX) advanced 0.75%.
But were Micron’s fiscal third-quarter 2026 results strong enough to dispel concerns about slowing AI momentum and drawing buyers back into the market? The tech-heavy Nasdaq Composite (IXIC), the Nasdaq-100 (NDX), and the S&P 500 had all sold off sharply over the previous two sessions amid worries that AI-driven growth was losing steam (with South Korea’s nearly 10% drop serving as a trigger) and that interest rates could remain higher for longer.
The NQ and the Micro E-Mini NQ futures contracts have seen trading volume rising, going into Thursday's, according toMarketFramework data. The risk disposition of futures traders is nearly neutral.
Micron’s “Drop the Mic” Quarter
The Boise Idaho-based company’s results exceeded every optimistic forecast, not on metric but all.
Source: Micron
Micron’s data center data center revenue that is associated with AI was at $25 billion in the third quarter, translating to annualized revenue run-rate of $100 billion.
Its strategic customer agreement count totaled 16, with the SCAs structured as “take-or-pay agreements, with binding commitments to purchase specific volumes over this multi-year term.” These SCAs are not letters of intent, but binding commitments, lending certainty concerning future revenue streams. The company said 14 carry guaranteed minimum revenue commitments totaling $100 billion, with customers having already deposited $22 billion in upfront cash. This is in contrast to the speculative demand narratives that fueled volatility earlier,
In prepared remarks delivered on the earnings call, Chairman and CEO Sanjay Mehrotra flagged tight memory supply market persisting beyond calendar year 2027 due to the AI-driven demand across all segments.
The forward outlook was robust at:
- $50 billion+/- $1 billion in revenue (Consensus $43.45 billion)
- $31 +/- $1 in adjusted EPS (Consensus $25.43)
- About 86% gross margin
AI Trade Has Room to Run — Analyst
Wedbush analyst Daniel Ives called Micron’s quarter as a ‘drop the mic” moment, which has alleviated memory concerns. Following Micron’s print, Ives said, “We are seeing no cracks in AI demand on the chips/hardware or software front which gives us a bright green light to own the core tech winners into year-end.” The analyst viewed that the tech sector and chip trade still have a lot of room to go higher over the coming months, with Wedbush’s Asia checks recent Asia checks giving further confidence to own tech stocks into the second half of 2026.
PCE Holds the Key
Yet the durability of Thursday's tech rebound hinges on a single data point arriving before the opening bell. May Personal Consumption Expenditures (PCE) inflation, the Federal Reserve's preferred inflation gauge, is due at 8:30 AM ET, and the print carries outsized weight given the current policy backdrop. Core PCE was already running at 3.3% year-over-year in April, well above the Fed's 2% target, and the Fed's June 17 dot plot flipped from a projected cut to aprojected hike by year-end, with nine of eighteen FOMC members now expecting tightening.
A May reading that comes in hotter than the consensus estimate of 3.4% risks handing the hawks fresh ammunition and could quickly arrest the Micron-fueled premarket surge, as Nasdaq futures are highly sensitive to inflation and rate expectations — if data keeps traders worried that rates may stay higher for longer, risk appetite can weaken and growth-heavy indices like the Nasdaq 100 can come under pressure.
Conversely, a soft or in-line PCE print would validate the rally, potentially clearing NQ's path toward the 30,975 all-time high. With Q1 GDP final revision and May durable goods orders also on the docket this morning, Thursday's 8:30 AM window is effectively a three-in-one macro stress test for a market that is already leaning bullish on the back of Micron's blowout.
Thursday's session, then, is a tale of two forces pulling in opposite directions. Micron has validaed AI's hardware buildout that the market has seen in this cycle: binding contracts, record margins, and a CEO who says supply cannot catch up with demand through at least 2027.
But the Nasdaq does not trade on fundamentals alone in a rising-rate environment, and one inflation print at 8:30 a.m/ ET has the power to reframe the entire morning. If PCE cooperates, the premarket optimism has a credible path to follow-through, with NQ eyeing a run at all-time highs and MU poised to open at a record. If it doesn't, even a "drop the mic" quarter may not be enough to drown out the Fed.