S&P futures exhibited an upward trend early on Monday, as traders closely monitored technology shares following last week’s fluctuations, while anticipating the forthcoming release of crucial inflation data and earnings reports from significant AI companies this week. S&P 500 futures increased by 0.34%, whereas Nasdaq 100 futures experienced a rise of approximately 0.5%. Futures associated with the Dow Jones Industrial Average experienced a notable increase, rising by 0.76%. Friday’s market experienced a partial rebound from Thursday’s severe AI-driven selloff, with chip stocks showing signs of recovery due to renewed buying activity. The tech-heavy Nasdaq Composite experienced an increase of 1.09%, reaching 24,579.42, while the broad-market S&P 500 saw a rise of 0.31%, climbing to 7,376.86. The blue-chip Dow, however, experienced a decline of 237.33 points, representing a decrease of 0.46%, ultimately closing at 51,285.73.
Investor sentiment across the broader market exhibited a cautious stance in the wake of a series of jobs data that surpassed expectations. Additionally, concerns persist following the Democrats’ robust midterm performance, as apprehensions regarding stricter regulations on data center construction, energy consumption, and development expenses may hinder the momentum of the AI infrastructure expansion. The tech sector will also be focused on the significant announcement Sunday that Nvidia’s board of directors is initiating an investigation into co-founder and CEO Jensen Huang’s relationship with a businesswoman identified by U.S. intelligence agencies as a Chinese spy. A proxy for Nvidia shares experienced a decline of 2% in the past 24 hours during trading on Hyperliquid. Liz Ann Sonders observed that the Nasdaq and Nasdaq-100 are currently oversold, reflecting significant de-risking activities among traders. Thursday represented the most significant day of retail sales since the onset of the Covid pandemic, as reported. According to Sonders, retail traders have not capitalised on the recent selloff.
“Retail has not proven to be the dip buyers that they have been in the past,” she told on Friday. “You saw a really heavy amount of net selling … we may not fully be washed out yet, but we’ll have to see whether that retail trader at some point decides to step back in.” Sonders indicated that the immediate attention should be directed toward companies’ modifications to capital expenditure plans and their projections for future profit margins. This week, investors are focused on upcoming AI-related earnings from CoreWeave, Cisco, and Applied Materials as they evaluate the tech sector’s outlook and consider the potential for further declines following the recent selloff. Market participants will closely monitor the upcoming releases of the consumer price index on Tuesday and the producer price index on Friday, seeking insights into the Federal Reserve’s forthcoming decisions.
On Monday, at 10 a.m., traders will receive the data on wholesale inventories for September. Take-Two Interactive Software, Occidental Petroleum, KKR, Constellation Energy, and Skydance are set to announce their quarterly earnings. In Asia, markets experienced a predominantly positive trend on Monday, with Taiwanese equities at the forefront of the increase. The Taiwan Weighted Index closed 4.94% higher at 41,664.7, representing the most significant single-day increase since 31 July. The index was propelled by advancements in technology giants Taiwan Semiconductor Manufacturing Company and Hon Hai Precision Industry, commonly referred to as Foxconn. Investors in Asia are evaluating the October inflation figures released from China, where the producer price index has reached its highest level in more than four years at 5.7%, while consumer inflation has come in below expectations at 0.7%.
