Stock Futures Steady as AI Chip Shift Rattles Semiconductor Sector
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A pause in momentum followed a strong start to the holiday-shortened week, with stock futures remaining largely unchanged Tuesday as investors digested news of a potential shift in the artificial intelligence chip landscape.
Stock futures tied to the Nasdaq were all trading within 0.1% of flat approximately one hour before the opening bell. This comes after a important rally on Monday, which saw the Nasdaq achieve its best single-day performance since May, rising 2.7%, while the S&P 500 and Dow gained 1.6% and 0.4%, respectively.
Economic Data and Rate Cut Expectations
Several key economic reports, delayed due to a recent government shutdown, are scheduled for release Tuesday. these include September’s retail sales figures, the Producer Price Index for wholesale prices, and the November reading on U.S.consumer confidence. Anticipation of this data has influenced market sentiment, with the CME FedWatch tool currently indicating an approximately 81% probability that the Federal Reserve will lower interest rates by 0.25% at its next meeting.
Treasury Secretary Scott Bessent indicated a potential declaration regarding the next Fed chair could come before Christmas. “There’s a very good chance that (president Donald Trump) will make an announcement before Christmas,” he stated in a CNBC interview.
nvidia Slides on Meta’s Potential Google Partnership
Shares of Nvidia (NVDA) experienced a notable downturn in premarket trading,falling 4.5% after a report in The Details suggested that Meta Platforms (META) is exploring the use of Google’s (GOOGL) AI chips in its data centers.This potential shift away from Nvidia’s chips sent ripples through the semiconductor industry. Conversely, Alphabet stock continued its upward trajectory, gaining an additional 4.5% before the bell following a 6.3% increase on monday after unveiling its advanced Gemini 3 AI model.
Other chipmakers also felt the impact. Advanced Micro Devices (AMD) and Micron Technology (MU) saw their shares point 6% and 1.5% lower, respectively. However, Broadcom (AVGO) bucked the trend, rising 4% after leading gains on both the S&P 500 and Nasdaq with an 11% surge on Monday.
Post-Earnings Reactions and Market Movers
Beyond the semiconductor sector, several companies reacted to their latest earnings reports. Dick’s Sporting Goods (DKS) dropped 4% after reporting weaker-than-expected results and announcing plans to close underperforming Foot Locker stores. Burlington Stores (BURL) fell 5.5% due to disappointing comparable sales figures. In contrast, Alibaba Group Holding (BABA) shares rose 3% following better-than-expected cloud revenue driven by strong demand for its AI services.
Commodities, Currencies, and Bond Yields
The cryptocurrency market also saw movement, with Bitcoin trading around $87,500, down from an overnight high of approximately $89,150. The yield on the 10-year Treasury note remained relatively stable at 4.03%. The U.S. dollar index,measuring the dollar’s performance against a basket of foreign currencies,edged lower to 100.00.
In commodity markets, WTI crude futures fell 2% to $57.60 per barrel,while gold futures rose 0.6% to $4,115 per ounce.
Investors should note that both stock and bond markets will be closed Thursday for the Thanksgiving holiday and will operate with reduced hours on Friday.
