US Stock Futures Show Modest Gains as Tech Sector Seeks Stability, CNBC reports.
Early Tuesday saw S&P 500 futures gain 0.2%, while Nasdaq 100 futures added 0.3% in premarket trading. Dow Jones Industrial Average futures slipped by 29 points, indicating a cautious recovery following Monday’s sharp market sell-off.
The downturn was fueled by concerns over the rapid rise of DeepSeek, a Chinese AI startup that recently unveiled an open-source large language model built for under $6 million. The development has sparked fears about Big Tech’s significant investments in artificial intelligence. DeepSeek also overtook OpenAI as the most downloaded free app in the US on Apple’s App Store.
Tech giants, particularly AI-linked companies, saw significant losses on Monday. Nvidia’s shares plunged nearly 17%, marking a record $600 billion market cap loss — the largest single-day drop for a US company in history. Broadcom and Oracle, which also faced losses, showed slight premarket gains of 2.8% and 2.3%, respectively.
Nvidia attempted a recovery, climbing 3% in early Tuesday trading. Analysts view the situation as indicative of investor wariness over AI market dynamics and increasing global competition from Chinese tech firms.
Investors are turning their attention to corporate earnings reports expected this week. Starbucks and Boeing are set to announce their quarterly results on Tuesday, followed by tech giants such as Meta Platforms, Microsoft, Tesla, and Apple later in the week.
Meanwhile, the Federal Reserve begins its two-day policy meeting, with markets pricing in a 97% chance that interest rates will remain unchanged, according to CMEGroup’s FedWatch Tool. Inflation data due Friday is expected to offer further insight into the health of the US economy.
Despite the AI-driven turbulence, Oppenheimer upgraded CNH Industrial to “outperform,” citing potential for a “reversion trade” and increased earnings in 2025. Additionally, Mizuho raised its price target for Autodesk to $400, citing positive industry trends and the company’s strong growth momentum.
The emergence of DeepSeek has also drawn political attention. US President Donald Trump described the startup’s success as a “wake-up call” for American industries, emphasizing the need for competitive innovation without excessive spending.
