- Futures are bouncing. S&P 500 and Nasdaq-100 futures rose 0.2% shortly after 6 p.m. ET on Sunday, and Dow futures climbed 103 points, or 0.2%. By Asian trading on Monday, Nasdaq 100 futures were up 0.9% and S&P 500 futures 0.5%, according to the Financial Times.
- The rebound follows a brutal Friday. The Nasdaq 100 slumped 3.5% in its worst day since June, capping its worst month in more than a year in October, and the Philadelphia Semiconductor Index tumbled 7.2%, as a losing week for US stocks was driven by selling pressure in tech.
- Oil and bonds are calm. Brent crude fell 3.02% to $110.01 a barrel and December WTI dropped 3.31% to $100.65 early Monday on reports that the US and Iran are seeking diplomatic options, while the 10-year Treasury yield slipped 0.4 basis point to 4.924% and the two-year rose 1.5 basis points to 4.595%, according to Tradeweb data cited by The Wall Street Journal.
- The week is packed with catalysts. Tuesday’s Nov. 3 midterm elections will decide control of Congress, the Treasury’s quarterly refunding announcement is due, Friday’s Nov. 6 nonfarm payrolls report could reset Fed rate expectations, and a busy slate of earnings rounds out the calendar.
What Happened?
US equity futures opened slightly higher on Sunday evening and extended gains in Asia as the global AI selloff eased. SK Hynix and Samsung Electronics gained 5.4% and 3%, lifting South Korea’s Kospi 2.8%, and China’s tech-focused Star 50 jumped 3% after reports that regulators were discussing market support with banks and brokerages. Not every chip stock joined in: TSMC fell 1.5% and Japanese memory maker Kioxia slumped 15.5% after warning that NAND flash price gains slowed to the mid-20% range in the September quarter from 70% in the prior quarter, and guiding to 2 trillion yen of operating profit versus the 2.35 trillion yen analysts expected.
Why It Matters?
Strategists see Friday’s rout as sentiment-driven rather than fundamental. “The sell-off that we saw on Friday is decoupled from the fundamental picture,” said Ecaterina Bigos of BNP Paribas Asset Management, who added that relatively low liquidity was magnifying price swings ahead of the midterms. Barclays’ Ajay Rajadhyaksha described the moves as “structural uncertainty about the AI build-out expressing itself through episodic panic.” Falling oil helps on the inflation front, but Kioxia’s warning is a reminder that parts of the semiconductor cycle are cooling, and futures gains of under 1% are small relative to Friday’s 3.5% drop.
What’s Next?
Watch whether tech can follow through on the bounce once cash trading opens, and whether the Philadelphia Semiconductor Index stabilizes after its 7.2% slide. Midterm results will start arriving late Tuesday and could shift expectations for fiscal and regulatory policy, while Friday’s jobs report will test the Fed’s hawkish tilt. Any breakdown in US-Iran diplomacy could quickly push oil, and inflation worries, back up.
Affected Tickers and Coins: SPY, QQQ, DIA, SOXX
Source: CNBC, Financial Times, The Wall Street Journal, CoinDesk, CoinDesk
