US stock futures pointed to a sharply lower opening on Friday, October 30, as renewed selling pressure in technology shares, disappointing corporate forecasts and rising oil prices weighed on investor sentiment.
Nasdaq 100 futures plunged 2.7%, suggesting that technology stocks could extend the previous session’s losses. Intel (NASDAQ:INTC) and Amazon (NASDAQ:AMZN) were among the biggest premarket decliners following disappointing financial updates.
Concerns about the substantial costs of artificial intelligence investment continued to unsettle markets, with investors increasingly questioning whether major technology companies can translate their spending into sustainable earnings and cash flow.
Geopolitical tensions in the Middle East added to the uncertainty, pushing US crude oil futures more than 2% higher following an attack on a tanker in the Strait of Hormuz.
Energy companies, including Chevron (NYSE:CVX) and Exxon Mobil (NYSE:XOM), moved higher before the opening bell after reporting sharply increased quarterly profits.
Intel and Amazon Lead Technology Shares Lower
Intel shares plunged more than 25% in premarket trading after the semiconductor manufacturer reported third-quarter earnings above analyst expectations but issued disappointing guidance for the fourth quarter.
The weaker outlook raised concerns about demand for personal computers and the near-term prospects of semiconductor manufacturers.
Amazon shares also fell nearly 8% before the market opened.
The online retail and cloud computing company reported third-quarter earnings and revenue below Wall Street estimates, alongside negative free cash flow.
The results added to growing concerns about the financial impact of heavy spending on artificial intelligence infrastructure.
Investors have become increasingly focused on whether technology companies can generate sufficient returns from their expanding capital expenditure programmes.
Daniela Hathorn, senior market analyst at Capital.com, said the market was becoming more demanding about the financial benefits of artificial intelligence investment.
“The message from investors is becoming clearer: strong AI demand is no longer enough on its own,” Hathorn said. “Companies need to demonstrate that substantial capital expenditure is translating into sustainable revenue growth, margins and free cash flow.”
She warned that the issue could continue weighing on the Nasdaq because a relatively small group of technology companies has accounted for a substantial proportion of recent market gains.
“This could remain a significant headwind for the Nasdaq, particularly given the concentration of market gains in a handful of technology companies,” she added.
Oil Prices Jump Following Strait of Hormuz Tanker Attack
Energy markets added another source of uncertainty as US crude oil futures climbed more than 2%.
The increase followed an attack on a tanker travelling through the Strait of Hormuz, a strategically important shipping route for global energy supplies.
According to reports, a small boat attached two explosive devices to the vessel’s hull. The identity of those responsible was not immediately established.
The incident heightened concerns about the security of commercial shipping and potential disruptions to oil supplies from the Middle East.
Additional geopolitical uncertainty emerged following reports from The Wall Street Journal and Axios that a senior military commander had briefed President Donald Trump on possible military options for a resumption of major combat operations against Iran.
The developments contributed to higher crude prices as traders assessed the possibility of further disruption to regional energy infrastructure and shipping.
Rising oil prices can increase costs for businesses and consumers, potentially adding to inflationary pressures and complicating the outlook for monetary policy.
Chevron and Exxon Mobil Gain on Strong Earnings
While higher oil prices weighed on broader market sentiment, energy stocks were positioned to benefit.
Chevron (NYSE:CVX) and Exxon Mobil (NYSE:XOM) recorded notable premarket gains after both companies reported substantial increases in third-quarter profits.
The positive earnings announcements reinforced investor interest in the energy sector at a time when crude prices were advancing.
Higher oil prices can support revenue and profitability for major producers, although the impact depends on production volumes, operating costs and other factors.
The strength in Chevron and Exxon Mobil contrasted with the heavy selling pressure affecting technology companies.
The divergence highlighted the different effects that rising energy prices and geopolitical developments can have across sectors.
Nasdaq Suffers Sharp Decline as Alphabet Shares Plunge
Friday’s weak futures followed a negative session on Wall Street on Thursday, when the major US indexes retreated after several days of gains.
The Nasdaq Composite fell 365.13 points, or 1.4%, to 26,184.72, reversing part of its 2.3% advance over the preceding three sessions.
The S&P 500 declined 23.59 points, or 0.3%, to 7,720.39, while the Dow Jones Industrial Average lost 132.54 points, also 0.3%, to close at 52,342.56.
Technology stocks were responsible for much of the weakness as concerns about artificial intelligence spending returned to the forefront.
Alphabet (NASDAQ:GOOG), Google’s parent company, plunged 13.2% after reporting third-quarter revenue below expectations and negative free cash flow.
The decline reflected investor concerns about the company’s substantial spending and whether its investments were generating sufficient financial returns.
Danni Hewson, head of financial analysis at AJ Bell, said Alphabet’s spending might have received a more favourable reaction if the company’s results had provided stronger evidence of returns.
“Alphabet’s accelerated cash burn might have been overlooked if the rest of its update had reassured investors that the money being spent is delivering, but shares in the company slid 13%, dragging down many of its tech heavy peers,” Hewson said.
The sharp decline contributed to weakness across software, computer hardware and semiconductor stocks.
Caterpillar Falls Despite Better-Than-Expected Results
Selling pressure was not confined to the technology sector.
Caterpillar (NYSE:CAT) shares dropped 9.6% on Thursday despite the construction equipment manufacturer reporting third-quarter earnings and revenue above analyst expectations.
The negative reaction demonstrated that stronger financial results were not sufficient to support every stock during a period of heightened market uncertainty.
Investors continued to assess company earnings alongside broader concerns about economic growth, capital expenditure and valuations.
Caterpillar’s decline added to the pressure on major US indexes, although several other sectors recorded gains during the session.
US Inflation Rises in Line With Expectations
Economic data released by the US Commerce Department showed that consumer prices increased as expected in September.
The personal consumption expenditures (PCE) price index rose 0.5% during the month, following a 0.3% increase in August.
The September reading matched economists’ forecasts.
On an annual basis, headline PCE inflation accelerated to 3.6% from 3.4% in August, also in line with expectations.
Excluding food and energy, the core PCE price index increased 0.3% month over month, matching both forecasts and an upwardly revised August reading.
Annual core PCE inflation edged higher to 3.1% from 3.0% in the previous month.
The figures indicated that inflationary pressures remained elevated, even though the latest readings did not exceed market expectations.
The PCE index is closely monitored by the Federal Reserve when assessing inflation and determining monetary policy.
A separate Commerce Department report showed that US economic growth exceeded economists’ forecasts during the third quarter of 2026.
The combination of stronger economic activity and persistent inflation provided investors with further information about the economic environment following the Federal Reserve’s decision to leave interest rates unchanged.
Housing and Pharmaceutical Stocks Outperform
Despite Thursday’s decline in the major US indexes, several sectors recorded substantial gains.
Housing stocks benefited from falling Treasury yields, with the Philadelphia Housing Sector Index advancing 3.8%.
Lower bond yields can help reduce borrowing costs and improve sentiment towards interest-rate-sensitive sectors such as housing.
Pharmaceutical stocks also performed strongly.
The NYSE Arca Pharmaceutical Index rose 3.4%, supported by positive corporate earnings.
Eli Lilly (NYSE:LLY) gained 6.8% after reporting third-quarter results above analyst expectations.
The company’s performance contributed to broader strength across pharmaceutical shares.
Airline, healthcare and commercial real estate stocks also recorded notable gains during the session.
The sector divergence demonstrated that investors continued to respond positively to favourable earnings and economic developments even as technology shares declined.
Gold and Semiconductor Stocks Face Selling Pressure
Gold mining companies were among Thursday’s weaker performers as the price of the precious metal declined.
The NYSE Arca Gold Bugs Index fell 3.2%, reflecting the pressure on mining shares.
Lower gold prices can reduce revenue expectations for producers, particularly when operating costs remain elevated.
Software, computer hardware and semiconductor companies also experienced notable declines.
The weakness across these technology-related industries contributed significantly to the Nasdaq’s 1.4% loss.
The negative performance highlighted the extent to which concerns about artificial intelligence spending and corporate financial outlooks were influencing technology valuations.
Wall Street Faces Further Pressure Ahead of Friday’s Opening
US equities appeared set to extend Thursday’s losses as investors weighed disappointing technology earnings, elevated oil prices and continued geopolitical uncertainty.
The 2.7% decline in Nasdaq 100 futures suggested that technology shares could remain under substantial pressure, particularly following the sharp premarket falls in Intel and Amazon.
Meanwhile, the rise in crude oil prices following the Strait of Hormuz tanker attack created additional concerns about inflation and energy supply disruptions.
Strong earnings from Chevron and Exxon Mobil offered support for energy stocks, while the previous session’s gains in housing and pharmaceutical shares demonstrated that opportunities for sector-specific advances remained.
Investors will continue monitoring corporate earnings, technology investment plans, inflation indicators and developments in the Middle East as they assess the direction of US markets.
The central concern remains whether the substantial spending associated with artificial intelligence can deliver sufficient growth in revenue, profitability and free cash flow to justify elevated technology valuations.