For Thursday, September 17 · posted 4:36 PM EDT

Software Earnings Lift Nasdaq as Tech Outperforms

We expect the Nasdaq 100 to gain 0.5% tomorrow, driven by strong software results. We put the odds of a green Nasdaq close at 63%.

Our call:Markets should go up·63% chance we're right·confidence 75/100

Today's take

From the editor

Software Earnings Lift Nasdaq as Tech Outperforms

We expect the Nasdaq 100 to gain 0.5% tomorrow, driven by strong software results. We put the odds of a green Nasdaq close at 63%.

We think the Nasdaq 100 (NDX) will close up 0.5% tomorrow, driven by robust earnings reports from enterprise software companies.

ServiceNow (NOW) is set to report Q3 results after the close today. We expect the company to beat consensus earnings per share by approximately 5% and raise its full-year revenue guidance by about 1.5%. Demand for IT workflow automation and digital transformation services remains strong, indicating that corporate spending on software infrastructure is holding up. This positive outlook for ServiceNow (NOW) is a key bellwether for the broader enterprise software sector and will likely lead to a 6.0% move in its shares, providing a significant tailwind for other software and cloud companies like Microsoft (MSFT) and Salesforce (CRM).

This positive sentiment from software earnings will likely extend to other mega-cap technology names. Nvidia (NVDA) is expected to gain 1.0% as investors continue to price in strong demand for its AI accelerators, complementing the enterprise software narrative of increased digital investment. Taiwan Semiconductor Manufacturing (TSM) is also poised for a 0.9% rise, benefiting from sustained global demand for advanced chips. The underlying mechanism is simple: when core enterprise software companies show robust growth, it signals healthy business investment, which directly translates to increased demand for cloud infrastructure and the chips that power AI applications.

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Trades to consider

Ten ideas for tomorrow · five shown

NOW will go up 8.5% tomorrow

Buy at $139.82 · sell at $151.70 · get out at $130.68

75%

chance it works

NVDA will go up 5.7% tomorrow

Buy at $213.90 · sell at $226.18 · get out at $204.46

68%

chance it works

CRM will go up 8.1% tomorrow

Buy at $250.54 · sell at $270.81 · get out at $234.94

65%

chance it works

MSFT will go up 3.5% tomorrow

Buy at $490.30 · sell at $507.61 · get out at $477.00

65%

chance it works

TSM will go up 3.9% tomorrow

Buy at $417.72 · sell at $434.14 · get out at $405.08

63%

chance it works

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Our calls for tomorrow

What we think each one does by the next open

SPX

+0.30%

SPX will go up 0.3% tomorrow

NDX

+0.50%

NDX will go up 0.5% tomorrow

DJI

+0.20%

DJI will go up 0.2% tomorrow

RUT

+0.10%

RUT will go up 0.1% tomorrow

VIX

-2.00%

VIX will go down 2.0% tomorrow

DXY

-0.10%

DXY will go down 0.1% tomorrow

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The market snapshot

Which parts look good, and what could move prices

Technology

68%

Financials

55%

Energy

52%

Healthcare

58%

Utilities

53%

Consumer Discretionary

60%

Consumer Staples

50%

Industrials

57%

Communication Services

65%

Materials

54%

Real Estate

52%

Software Earnings Season
Early Q3 earnings reports from enterprise software companies like ServiceNow (NOW) are signaling robust corporate IT spending and strong subscription growth, which is bullish for the broader technology sector, particularly the Nasdaq 100 (NDX).
75% chance it moves the market
US Q2 GDP Revision
The final revision of Q2 GDP at 8:30 AM ET could either confirm economic resilience, boosting broader market confidence, or show unexpected weakness, leading to a risk-off sentiment and concerns about future growth. A surprisingly strong print could also push yields higher.
60% chance it moves the market
Technology Sector Momentum
The momentum from positive software earnings is expected to spill over into other technology sub-sectors, driving gains in mega-cap tech and semiconductor names as investors position for continued innovation and enterprise adoption of AI.
70% chance it moves the market
Initial Jobless Claims
Weekly jobless claims data at 8:30 AM ET provides a real-time look at the labor market. A surprising increase could signal cooling, easing rate hike fears, while a sharp decrease could reinforce the 'higher for longer' narrative for rates.
55% chance it moves the market
Treasury Yields
Treasury yields (US10Y) will react to the GDP and jobless claims data. A significant rise in yields could weigh on growth stocks, while stable or falling yields would provide a tailwind for equities.
60% chance it moves the market

Full sector view →Everything we're watching →