The Nasdaq led a tumble in US stock futures on Thursday as Meta (META) and Microsoft’s (MSFT) earnings sparked worries about prospects for Big Techs amid rising AI costs.
Contracts on the tech-heavy Nasdaq 100 (NQ=F) sank 0.9%, while S&P 500 futures (ES=F) fell over 0.7%. Dow Jones Industrial Average futures (YM=F) dropped roughly 0.5%, on the heels of losses for the major gauges.
Optimism for a Big Tech boost to stocks took a knock as investors digested Meta and Microsoft’s quarterly reports. While the results beat Wall Street estimates, both companies flagged that they will step up already high spending on AI infrastructure.
Concerns that would put pressure on profitability helped send shares in both Meta and Microsoft about 4% lower in premarket trading.
The unsettled mood spread to Amazon (AMZN) and Apple (AAPL), which round off this week’s “Magnificent Seven” earnings with reports after the close on Thursday. Shares in the tech megacaps stepped lower in premarket.
Investors are also on tenterhooks waiting for the latest reading on the Personal Consumption Expenditures index, the last key inflation input for the Federal Reserve before its policy decision next week. Economists expect annual “core” PCE — which excludes food and energy prices — to come in at 2.6% for September, down from 2.7% the previous month.
Read more: What the Fed rate cut means for bank accounts, CDs, loans, and credit cards
Also on deck are updates on jobless claims and job cuts, in focus after an October surge in private payrolls muddied the picture ahead of the crucial monthly jobs report due for release on Friday.
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