US stock futures tick higher as tech steadies though oil, yields stay high
Tech stocks were in focus as Anthropic's IPO prospectus showed the AI lab had grown sharply over the past year while also posting wider losses.
US stock index futures edged upward on Tuesday, as certain technology shares gained ground, while overall risk sentiment remained restrained due to the Middle East conflict driving oil prices up and bond yields remaining elevated. Tech stocks garnered attention as Anthropic's IPO prospectus, as reported by Reuters, disclosed the AI lab's significant expansion over the past year but also highlighted widening losses.
Anthropic is aiming for a valuation surpassing US$2 trillion in a potential public offering, which could serve as a benchmark for how Wall Street assesses top AI companies.
Many chip-related firms saw gains in premarket trading following a sector-wide sell-off the previous day. Marvell Technology, Micron Technology, and Broadcom all rose by approximately 1%. Nvidia edged up 0.7%, continuing its Monday's increase when the world's most valuable company expanded its share repurchase authorization by a record US$150 billion.
The AI theme, which has driven most of the bull market since October 2022, remains significant. OpenAI CEO Sam Altman's remarks at the company's DevDay event later in the day will be closely watched by investors. At 7:20 am, Dow E-minis climbed 52 points, or 0.1%, S&P 500 E-minis increased 9 points, or 0.11%, and Nasdaq 100 E-minis rose 72 points, or 0.24%.
The S&P 500 recorded its largest one-day percentage decline since late August on Monday, as tech stocks faced pressure amid geopolitical uncertainty. Market participants are anticipating a break or at least clarity on the war to bolster sentiment. However, such developments are unlikely to occur soon, according to Kyle Rodda, a senior financial market analyst at Capital.com.
Rising energy prices are fueling inflation, prompting central banks to hike interest rates, and negatively affecting equities and other risk assets globally. Brent crude futures were close to the US$105 per barrel mark. US President Donald Trump dismissed media reports suggesting he would ease sanctions and release frozen funds for concrete steps regarding Iran's nuclear program.
The yield on the benchmark 10-year Treasury bond approached its highest level since 2007, signaling expectations of more stringent monetary policy. Economic data has received increased scrutiny as the Federal Reserve has softened its stance on future policy decisions under Chair Kevin Warsh. Traders currently estimate a 70% probability of another interest rate hike in October, per the CME FedWatch Tool.
Job openings data for August, the first of several economic reports due this week, will be released later in the day. Six Federal Reserve officials, including New York Fed President John Williams, are scheduled to speak on Tuesday. Other notable movers included Summit Therapeutics, which surged 18.4%. The biopharma company announced that British drugmaker AstraZeneca would invest US$2 billion in it and collaborate on multiple studies testing their cancer treatments jointly.
Snack and soda giant PepsiCo fell 0.8% after JP Morgan downgraded the stock to neutral from overweight.
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