US stock futures fell sharply on Thursday as the market continued to deal with the fallout from a two-day tech sell-off. Investors anxiously waited for Amazon’s earnings report while also evaluating Alphabet’s extensive plans for artificial intelligence (AI) investments. Futures for the S&P 500 dropped approximately 0.6%, and Nasdaq 100 futures fell by 0.9%. Meanwhile, futures linked to the Dow Jones Industrial Average faced a milder decline of about 0.3%, reflecting its lesser exposure to tech stocks.
The market turmoil has been characterized by a dramatic “trillion-dollar tech wipeout,” which has left investors questioning whether the decline in certain software stocks was overblown. Concerns surrounding the potential disruption from AI technologies have intensified, overshadowing substantial AI spending by major tech firms.
Last night, Alphabet reported a significant increase in its AI investment, announcing a staggering commitment of up to $185 billion during its quarterly results, which contributed to the dip in its stock. This announcement led to a broader reassessment of tech stock valuations, with Wall Street paying close attention to the ongoing earnings season and the implications of increased AI expenditures.
Amid this backdrop, all eyes are now fixed on Amazon’s quarterly report, scheduled for release later in the day. Investors are particularly interested in the performance of its Amazon Web Services (AWS) cloud division, which is anticipated to report a revenue increase of 21%.
In the commodities market, silver prices plummeted by as much as 17%, erasing gains from the previous two days. This drop followed significant selling by Chinese buyers and has raised questions about whether recent surges in precious metals were unsustainable. As commodity traders adjusted their expectations, concerns grew that further declines could be on the horizon.
In parallel, bitcoin also saw a decline after Treasury Secretary Scott Bessent ruled out any government bailout for the cryptocurrency. The token fell below the critical $70,000 mark, reflecting a growing crisis of confidence among cryptocurrency investors.
Market attention is also turning to weekly jobless claims as an update is expected, following a disappointing ADP report indicating that job growth was slower than anticipated in January. This data has taken on added significance due to the recent partial government shutdown, which delayed the monthly jobs report until the following week.
In individual stock news, Nio, a Chinese electric vehicle manufacturer, buoyed its stock by announcing it expects to post its first-ever profit in the fourth quarter, which propelled shares up by 6% in premarket trading. In contrast, shares of Estée Lauder fell 10% despite the company beating earnings expectations, as tariff concerns overshadowed its quarterly success.
Premarket activity showed varying trends among other notable companies. Strategy, a major corporate holder of cryptocurrency, saw its stock tumble over 5% amidst the bitcoin drop. Conversely, shares of Tapestry rose 5% after exceeding revenue estimates and raising its full-year guidance. Baidu’s U.S.-listed shares also climbed 5% following news of a dividend issuance and a significant stock buyback program.
Despite these fluctuations, Broadcom’s stock jumped by 5% following Alphabet’s favorable capex forecasts, underscoring the interconnectedness of tech investments and chip developers.
In contrast, Qualcomm’s shares fell around 11% after a strong earnings report failed to meet market expectations for future growth, hindered by a memory chip shortage affecting its forecasts.
As the market navigates through this precarious landscape, the implications of rising AI investments and ongoing volatility in both tech and commodities remain at the forefront of investor concerns.
