S&P 500 Futures Edge Higher as Oil and AI Concerns Weigh on Tech
S&P 500 futures rose 0.1% Thursday night after Wall Street’s broader indexes fell for a second straight session. Rising oil prices revived inflation…
S&P 500 futures edged 0.1% higher Thursday night as rising oil prices revived inflation worries and concerns about OpenAI’s revenue outlook weighed on technology stocks. Nasdaq 100 futures traded flat, while Dow Jones futures rose 0.2%, according to Investing.com.
The moves followed a second consecutive decline for Wall Street. Investors were weighing the cost of energy and borrowing against questions about demand for artificial intelligence infrastructure, a combination that put pressure on chipmakers and other technology companies.
The futures contract stood at 7,825.25.0 points by 20:26 ET (00:26 GMT), the source reported. Nasdaq 100 futures were at 30,978.75 points and Dow Jones futures at 51,570.0 points.
During the regular session, the NASDAQ Composite dropped 1.3% to 27,193.34 and the S&P 500 lost 0.5% to 7,765.36. The Dow Jones Industrial Average edged up 0.1% to 51,231.64, outperforming as technology shares came under pressure.
Oil and AI concerns weigh on shares
Rising crude prices added to concerns about inflation while borrowing costs remained elevated. U.S. crude futures settled 3.6% higher, while Brent crude rose 4.1% above $104 per barrel. Production cuts linked to a hurricane in the Gulf of Mexico also tightened supply expectations, according to the report.
That energy move matters for investors because higher oil prices can intensify price pressures just as markets assess the path of interest rates. Elevated borrowing costs can weigh especially on growth stocks, whose valuations are sensitive to financing conditions.
Technology shares also fell as investors assessed reporting about OpenAI’s revenue. The Financial Times reported that the company told investors annualized revenue was approaching $50 billion at the end of September, below the $70 billion figure previously reported by media outlets.
The difference reflects how companies account for sales made through cloud partners, the report said. Anthropic includes revenue from partners such as Amazon Web Services and Google Cloud, while OpenAI excludes those sales from its calculation, according to the Financial Times report.
Questions followed about the scale of AI demand and whether heavy spending on computing infrastructure will deliver financial returns. The pressure was visible across semiconductor and infrastructure-related stocks.
The Philadelphia Semiconductor Index fell 3.4%. Nvidia dropped 2.9%, Advanced Micro Devices slid 3.9% and Micron Technology lost 4.8%. Broadcom declined 4.4%, while Oracle shed 5.5%, amid concern about financing large-scale AI infrastructure projects.
Bond yields and earnings in focus
Treasury yields eased from session highs after a $22 billion auction of 30-year bonds drew steady demand, providing some relief to bond markets. The benchmark 10-year Treasury yield fell to around 5.23%, after earlier rising to levels near its highest since 2002.
The retreat offered a counterweight to the pressure from energy and technology shares, though yields remained elevated. That kept borrowing costs in view as investors considered the outlook for growth stocks and the broader market.
The pullback came two days after the Nasdaq Composite and S&P 500 reached record closing highs. Traders were also looking ahead to the start of the third-quarter earnings season next week, when major U.S. banks are due to report results.
Separately, a U.S. market morning update published by Simply Wall St said stock futures were essentially flat, with E-mini S&P 500 contracts edging up fractionally. It pointed to a widening trade deficit and stronger consumer sentiment as competing signals for the market.
The trade deficit reached $105.6b in August, a 17 month high, while imports hit a record $420.8b, according to that update. It said firm demand could reflect consumer and business appetite, while higher costs for imported goods and energy may add to price pressures. An economic optimism index climbed to 46.8, its best reading since March.
That update also flagged U.S. initial jobless claims and the Atlanta Fed GDPNow estimate as Thursday’s market indicators, and Michigan Consumer Sentiment for Friday. PepsiCo was due to report Q3 results on Thursday, with Delta Air Lines scheduled to post Q3 numbers on Friday, according to the same source.
Investors are now watching next week’s bank results as the next major test for the market’s outlook.
Source: finance.yahoo.com
