Key facts
- Nasdaq 100 E-minis were up 212.5 points, or 0.74%, at 7:01 a.m. ET on Monday.
- The Nasdaq-100 shed over $2.5 trillion in market value in October and neared correction territory.
- Intel fell about 1% after forecasting quarterly revenue below market estimates and no positive cash flow this year.
- Estée Lauder gained 2.6% after raising annual sales and profit forecasts; Okta rose 2.7% on its S&P 500 addition.
- Oil prices fell more than 4% as Iranian and Qatari officials held talks on ending the US-Israeli war on Iran.
US stock index futures were higher on Monday, November 2, as technology and AI-related stocks steadied after a weak October, with investors focused on the midterm elections and a busy week of earnings.
At 7:01 a.m. ET, Dow E-minis were up 256 points, or 0.49%, S&P 500 E-minis were up 35 points, or 0.46%, and Nasdaq 100 E-minis were up 212.5 points, or 0.74%. Most megacap and growth stocks rose in premarket trading, with SpaceX and Alphabet among the top gainers.
The tech-heavy Nasdaq-100 shed over $2.5 trillion in market value in October and was on the brink of correction territory, as investors grew wary of Big Tech's AI spending while awaiting evidence of stronger returns. Several companies have tapped the bond market to finance those investments, amplifying concerns that debt-funded spending will become harder to justify as borrowing costs rise.
Media reports on Friday said OpenAI had slashed the target for its latest funding round by $10 billion. A separate report said Blackstone told investors that Anthropic may not secure an investment-grade rating after its IPO.
Intel extended losses, down about 1%, after its worst one-day fall since the 1980s on Friday. The chipmaker forecast quarterly revenue below market estimates and said it does not expect positive cash flow this year. Rival AMD is set to report earnings later this week, while Apple eased 0.4% ahead of its quarterly earnings due after the bell.
"It is likely to remain volatile through the earnings season, and individual companies may get punished by the market if they're not fulfilling the market's asks on all of those fronts," said Kiran Ganesh, multi-asset strategist at UBS Global Wealth Management.
Risk sentiment also got a lift from oil prices falling more than 4% as talks between Iranian and Qatari officials on a deal to end the US-Israeli war on Iran raised hopes that Middle East supply disruptions could ease.
The week's key catalysts include the US midterm elections on Tuesday, which will determine whether Democrats can wrest control of Congress from President Donald Trump's Republican Party. Democrats are widely predicted to win the House of Representatives, but the Senate is more in doubt.
"Midterm elections tend to be unfavourable events for the party in power and a Democratic victory in the House of Representatives would return the US to divided government, which would hardly be unusual," said Seth Meyer, global head of client portfolio management at Janus Henderson Investors.