Key takeaways
- Dow futures fall as investors await midterm results
- Apple and Palantir decline despite strong quarterly earnings
- AMD earnings could test confidence in AI stocks
US stock futures were mixed on Tuesday, November 3, as investors prepared for the midterm elections while disappointing reactions to Apple and Palantir earnings added pressure to an already weakened technology sector.
Сoncerns about artificial intelligence spending and political uncertainty weighed on global equities. Dow Jones futures fell approximately 0.7%, S&P 500 futures declined 0.2%, while Nasdaq-100 futures edged higher.
The cautious opening follows Monday's selloff, which pushed the Nasdaq 100 into correction territory, down 10.4% from its October record.
Apple and Palantir Stocks Fall Despite Strong Earnings
Apple shares dropped approximately 4.5% in premarket trading after the company reported record quarterly revenue but warned that rising memory-chip costs could pressure holiday-quarter profitability.
The iPhone maker generated $114.48 billion in quarterly revenue, but its earnings outlook disappointed investors concerned about margins and slower services growth.
Palantir also declined approximately 6.3% before the opening bell despite reporting stronger-than-expected third-quarter results and raising its revenue forecast.
The company's US commercial contract value grew just 11% year over year, raising questions about whether its exceptional AI-driven revenue growth can continue.
The weakness follows an October semiconductor selloff that erased approximately $1.64 trillion from chipmakers over six sessions.
Dow Jones, Nasdaq and S&P 500 Face Different Pressures
Monday's session demonstrated how uneven the market downturn has become.
The Dow Jones gained 0.4% to close at 51,983.98, while the S&P 500 declined 0.5% to 7,541.40 and the Nasdaq Composite fell 1.1% to 25,164.32.
Investors have increasingly questioned whether Big Tech's enormous infrastructure spending will generate sufficient returns, particularly as borrowing costs remain elevated.
Higher Treasury yields can pressure technology valuations by increasing financing costs and reducing the present value of future profits.
The benchmark 10-year Treasury yield traded near 4.94% on Tuesday, adding another concern for companies funding expensive AI projects.
What Could Move the Stock Market Today?
The immediate focus is Tuesday's US midterm elections, with investors assessing whether Democrats could gain control of Congress and potentially pursue tighter oversight of AI infrastructure.
However, corporate earnings may prove equally important.
Advanced Micro Devices is scheduled to report results after Tuesday's closing bell, with investors looking for evidence that semiconductor demand remains resilient despite recent stock declines.
The company's earnings test follows Intel's historic 29% decline and mounting pressure on AI chipmakers.
