U.S. stock index futures inched higher early Monday, signaling tentative optimism after last week’s selloff, even as unease lingered around technology shares. S&P 500 futures climbed 0.3% to 6,849, while Nasdaq 100 futures rose 0.2% and Dow Jones futures advanced 0.3%, reflecting a cautious start to a data-heavy week.
The modest gains follow a bruising end to last week, when technology stocks led Wall Street lower. Investors stepped back from high-growth names amid renewed questions about the pace and profitability of artificial intelligence investments. Still, losses were partly cushioned by strength in non-tech sectors, helping broader indexes avoid steeper weekly declines.
Markets are now shifting focus to macroeconomic signals that could define interest-rate expectations into early 2026. With volatility elevated, traders appear reluctant to take aggressive positions ahead of key economic releases.
AI Doubts Weigh on Tech Sentiment
Technology stocks remain under pressure after disappointing guidance from Broadcom and Oracle dented confidence in the AI-driven rally. Broadcom shares plunged 11.4% on Friday, after the company flagged margin softness and said a major data-center partnership with OpenAI would not contribute meaningful revenue until at least 2027.
Oracle added to the gloom a day earlier, sliding more than 12% last week after issuing weaker-than-expected quarterly guidance. Investors were particularly unsettled by Oracle’s heavy capital spending on AI infrastructure and its reliance on OpenAI-linked revenue commitments.
The fallout spread quickly across the sector:
- Nvidia fell more than 4% last week, dragging down the “Magnificent Seven”
- The Nasdaq Composite dropped 1.7% on Friday
- The S&P 500 declined 1.1%, while the Dow lost 0.5%
Together, these moves reflect growing skepticism over whether elevated AI valuations can be justified by near-term earnings growth.
Payrolls, CPI to Shape Fed Outlook
Attention now turns to November nonfarm payrolls and consumer price inflation data, due Tuesday and Thursday. The payrolls report—normally released on the first Friday of the month—was delayed following disruptions tied to October’s government shutdown.
Economists say the data could significantly influence expectations for further monetary easing. Any signs of cooling job growth or easing inflation would likely reinforce bets on additional rate cuts after the Federal Reserve’s recent 25-basis-point reduction.
The Fed has emphasized that future decisions will remain data-dependent. However, its announcement last week that it will purchase $40 billion in short-dated Treasuries per month has already tilted expectations toward a more accommodative stance heading into 2026.
For now, U.S. equities appear caught between AI-driven uncertainty and macroeconomic anticipation, leaving markets reactive as investors wait for clearer signals on growth, inflation, and interest rates.