Stock futures are pointing to a lower open for major indexes on Wednesday, as AI investor favorite Nvidia (NVDA) and other large-cap technology stocks remain under pressure after the previous session’s selloff.
Futures tied to the S&P 500 and Nasdaq 100 were down 0.4% and 0.8%, respectively, while those linked to the Dow Jones Industrial Average fell 0.2%. The major indexes are coming off their worst day since Aug. 5, as September is starting much the same way as the previous month amid concerns about the health of the U.S. economy and a sharp downturn in chip stocks.
Nvidia shares, which fell nearly 10% on Tuesday, were down 1.5% in recent premarket trading. Adding to concerns about a slowdown in the AI chipmaker’s blockbuster growth, the company has reportedly received subpoenas from the Justice Department as part of an antitrust investigation. The VanEck Semiconductor ETF (SMH) was down 1.2% ahead of the bell.
Other mega-cap technology stocks were down across the board, with Apple (AAPL), Meta Platforms (META), Amazon (AMZN), Alphabet (GOOGL) and Microsoft (MSFT) all losing ground.
Among other notable movers, shares in Zscaler (ZS) were down 17% after the provider of cloud-based cybersecurity services issued an earnings outlook that came in well below Wall Street expectations.
On the economic data front, trade numbers released early Wednesday came in as expected, while closely watched figures on job openings are due at 10:00 a.m. ET. On Tuesday, two indicators of manufacturing activity showed continued sluggish activity in the sector, which has been weighed down by high interest rates. The most highly anticipated event of the week comes Friday, with the release of the August jobs report, which investors will be watching closely after a higher-than-expected July unemployment reading sent markets reeling in early August.
Market participants are watching economic indicators closely to get a sense of how aggressive the Federal Reserve might be in cutting its benchmark interest rate. Fed Chair Jerome Powell has signaled that rate cuts are coming, possibly as soon as the September meeting of the central bank’s policy committee, but has said that incoming data will drive the decisions on the pace and depth of the easing.
The yield on 10-year Treasurys, which is sensitive to expectations around interest rates, was down to around 3.82% Wednesday morning, from 3.84% yesterday, at its lowest level in more than a week.
Gold futures were slightly lower at around $2,520 per ounce, while bitcoin fell to a four-week low below $57,000.