U.S. stock futures dropped on Tuesday, with the tech sector leading the decline, highlighting Wall Street’s ongoing concerns about artificial intelligence that have weighed on the markets recently.
Specifically, Nasdaq 100 futures fell by 0.8%, and S&P 500 futures dropped about 0.5%. The Dow Jones Industrial Average, which is less influenced by tech stocks, saw a decrease of 0.3% in its contracts.
After the Presidents Day holiday, it seems that the sell-off of tech stocks may continue as worries over AI persist. Investors are looking for the next potential target, as new fears about AI’s industry-altering abilities have affected stocks across various sectors, including asset management, transportation, and logistics. Under this pressure, the Dow and S&P 500 have seen declines in four of the last five weeks.
This week also marks the latter stages of the earnings season. Companies like Constellation Energy, Energy Transfer, Medtronic, and Palo Alto Networks are set to report, which may indicate how AI’s energy demands are reshaping the sector. However, the main event this week is Walmart’s quarterly report scheduled for release on Thursday, notable as it is the first since the retail giant joined the multitrillion-dollar market cap club.
On another note, shares of Paramount Skydance rose by 2% in pre-market trading after Warner Bros. Discovery provided the studio a week to make a more competitive offer, following a rejection of their latest bid by a Hollywood studio.
Additionally, this holiday-shortened week brings an array of economic data, which had been postponed due to a partial U.S. government shutdown. A key report to watch is December’s personal consumption expenditure index, set to be released on Friday, particularly important as the last consumer inflation data was weaker than anticipated.
As discussions about the pace of interest rate cuts continue, Friday will also see the release of the fourth quarter GDP report, which should provide insights into the economy’s health. Before that, the minutes from the Federal Reserve’s January meeting will also play a crucial role in shaping those discussions, particularly given the ongoing questions surrounding Kevin Warsh, Trump’s nominee for the next Fed chair.
