Key facts
- US stock futures declined on Friday due to concerns over AI sector funding and increased competition in the telecom market.
- AI-related stocks experienced sharp swings this week, with Meta's shares falling nearly 8% after reporting its first cash outflow in over a decade.
- Telecom companies AT&T, Verizon, and T-Mobile were down more than 3% premarket on reports of SpaceX's potential wireless carrier program.
- US cell tower operators Crown Castle and American Tower gained in premarket trading on the SpaceX news.
- S&P 500's third-quarter profit growth is forecast at 32.3%, up from 30.7% previously, according to LSEG data.
Wall Street futures dipped on Friday as caution set in after a significant selloff in AI-linked stocks, driven by concerns over the sector's substantial funding needs. Telecom shares also slid in premarket trading due to fears of increased competition from SpaceX, which is reportedly in talks with cellular infrastructure providers about launching a nationwide wireless service. AT&T, Verizon, and T-Mobile were each down over 3% premarket, while US cell tower operators Crown Castle and American Tower saw gains. AI-related stocks had swung sharply this week, initially pressured by CoreWeave's debt and AI investment costs, then rallying on Wednesday after positive SpaceX and Super Micro results, only to reverse gains on Thursday. The tech-heavy Nasdaq Composite fell nearly 3% on Thursday, with Meta's shares declining almost 8% after reporting its first cash outflow in over a decade amid AI expenditure worries. In premarket trading on Friday, CoreWeave rose 2%, while 'Magnificent 7' stocks were mixed. Dow E-minis were down 0.58%, S&P 500 E-minis down 0.2%, and Nasdaq 100 E-minis were flat. Brent crude held near a five-month high due to Middle East supply concerns, adding to inflation worries ahead of the Federal Reserve's policy meeting next week. The Nasdaq was on track for a weekly loss, while the S&P 500 and Dow remained higher for the week, supported by defensive sectors. Market focus is also on earnings season, with American Express and SLB set to report.