S&P 500 futures exhibited a downward trend early on Tuesday as investors assessed Apple’s quarterly earnings report while anticipating the outcomes of the U.S. midterm elections. Futures for the Dow Jones Industrial Average experienced a decline of 0.5%, whereas S&P 500 futures saw a marginal decrease of less than 0.1%. Nasdaq-100 futures experienced an increase of 0.4%. Apple shares experienced a decline of 2% in after-hours trading following the release of a less-than-optimistic margin forecast, coupled with iPad sales in the fiscal fourth quarter falling short of analysts’ expectations. During the standard trading hours in the United States, the Nasdaq Composite, which is heavily weighted toward technology, experienced a decline of 1.07%.
Meanwhile, the S&P 500 saw a decrease of 0.51%, reflecting investors’ ongoing shift away from technology stocks. The Dow experienced an increase of approximately 214 points, translating to a rise of 0.41%. Marvell Technology shares experienced a decline of approximately 12%, while Lumentum saw a drop of 18% following the announcement of Marvell’s intention to acquire Lumentum in a $115 billion transaction. Oracle shares experienced a decline of 8% following the announcement of the company’s intention to issue $10 billion in common stock and $10 billion in bonds to support its artificial intelligence development efforts. As Tuesday nears, market participants are focusing on the midterm elections, with prediction market traders estimating a nearly 75% probability of Democrats securing control of the Senate. A sweep of the House and Senate by Democrats could trigger a sell-off for artificial intelligence stocks, according to JPMorgan.
Even with President Donald Trump in the White House, a victory by Democrats in either the House or Senate could influence investigations and oversight in Washington — a crucial factor for sectors such as defence, artificial intelligence, and healthcare. Once the elections are over, markets may find some calm, according to Ryan Detrick. “There’s some anxiousness before these elections,” he told. “Once you are through it, it’s a big relief and markets tend to do pretty well.” However, an outright sweep by either party could shake up stocks. “If you have a huge red wave or a big blue wave, markets actually kind of don’t like that as much because you have too much spending one way and too much power,” Detrick said. Tuesday is set to be a bustling day for investors, filled with a wave of corporate earnings.
Pfizer, Shopify, Eaton, and Marathon Petroleum will report results before the open, with Advanced Micro Devices and Super Micro Computer following in the afternoon. Traders are on standby for September’s Job Openings and Labour Turnover Survey, along with factory orders data. Asian markets dipped on Tuesday, driven by tech declines in South Korea and Taiwan. The Kospi dropped 3.59% to 5,648.79, and the Taiwan Weighted Index also fell 3.59%, closing at 43,307.54. Mainland China’s CSI 300 dipped 0.2% to 4,008.87. Australia’s S&P/ASX 200 rose 0.34% to close at 8,886.8, while Hong Kong’s Hang Seng Index climbed 0.37% in its last trading hour. Japan’s markets are closed for a holiday.
