Nasdaq set to open flat as Nvidia slips on China market uncertainty

• Futures up: Dow 0.16%, S&P 500 0.09%, Nasdaq 0.08%
• US weekly jobless claims fall amid low layoffs
• Snowflake surges on AI-driven revenue forecast
• Dollar General up after lifting annual targets on strong demand

Aug 28 (Reuters) - The tech-heavy Nasdaq was on track to open flat on Thursday, constrained by weakness in Nvidia shares, as uncertainty around the Sino-U.S. trade war forced the AI chip giant to leave out potential China sales from its quarterly forecast.

The exclusion came despite the company having secured certain licenses earlier this month to sell its H20 chips to major market China, after reaching a revenue-sharing deal with the U.S. government.

Nvidia's NVDA.O shares slipped 0.3% in premarket trading, as some analysts also raised concerns about whether the company's data center results hinted at tighter spending by cloud providers.

Still, its strong quarterly revenue forecasts, $60 billion share buyback plan and CEO Jensen Huang's upbeat comments placated investor concerns around artificial intelligence demand.

"These results are good for a normal company in normal times, but Nvidia is neither. The lack of China revenue and uncertainty around future shipments is a concern. The longer this takes, the more entrenched domestic (China) alternatives become," said Paul Meeks, managing director at Freedom Capital Markets.

The enthusiasm around AI earnings prospects was the driving force behind Wall Street's bull-market run that started nearly three years ago. The rally has survived multiple hiccups this year, including the unveiling of cheaper Chinese AI models and the U.S. tariff-induced selloff in April.

Semiconductor peers Super Micro Computer SMCI.O and Advanced Micro Devices AMD.O struggled for direction, as did major customers of Nvidia including Meta META.O and Microsoft MSFT.O.

Data analytics company Snowflake SNOW.N gained 14.4% after raising its forecast for fiscal 2026 product revenue, citing AI demand.

At 08:43 a.m. ET, Dow E-minis YMcv1 were up 71 points, or 0.16%, S&P 500 E-minis EScv1 were up 6 points, or 0.09%, and Nasdaq 100 E-minis NQcv1 were up 17.75 points, or 0.08%.

The other dominant theme that has lifted the benchmark S&P 500 .SPX to record highs has been expectations that the Federal Reserve could lower interest rates for the first time this year in September.

Futures tracking the rate-sensitive Russell 2000 small-caps index RTYcv1 gained 0.5% before the bell, while S&P 500 futures were just shy of a record high.

Traders are pricing in an 84.2% chance of a September rate-cut, according to data compiled by LSEG.

Data on Thursday showed jobless claims stood at 229,000 last week, compared with expectations of 230,000. A separate report showed second-quarter gross domestic product increased 3.3% according to a second estimate, more than the 3% previously estimated.

All eyes will be the Personal Consumption Expenditures index expected on Friday and any signs of inflation increasing could temper expectations for a September rate cut.

Coming later in the day are remarks from Fed Governor Christopher Waller, who is perceived as dovish and among the candidates being considered to replace Fed Chair Jerome Powell next year.

Uncertainty regarding central bank independence also remains, after U.S. President Donald Trump's attempt to fire Fed Governor Lisa Cook earlier this week.

Among others, cybersecurity firm CrowdStrike CRWD.O dropped 3.4% after forecasting weak third-quarter revenue.

Discount store operator Dollar General DG.N gained 4.7% after raising annual forecasts, while packaging food company Hormel Foods HRL.N lost 10.4% after its quarterly profit forecast missed expectations.

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