U.S. equity futures moved modestly higher on Monday as investors monitored escalating tensions in the Middle East while preparing for a busy week of earnings from some of the world’s largest technology companies.
Dow Jones futures gained around 0.1% in early trading, while S&P 500 futures advanced 0.2%. Nasdaq 100 futures led the gains, rising 0.5% as markets looked ahead to quarterly results from several major technology names.
Wall Street ended Friday’s session lower after renewed concerns emerged over the sustainability of heavy investment in artificial intelligence. Although AI-related stocks have been a major driver of market performance this year, some investors have begun reducing exposure as valuations come under greater scrutiny.
The semiconductor sector remained under pressure, with the Philadelphia Semiconductor Index falling more than 20% from its June high, placing the benchmark in bear market territory.
Analysts at Vital Knowledge said, “For tech investors, bears won the week overwhelmingly, although the slump was more a function of narrative shift and technical dislocation (extremely crowded and complacent positioning and bullish but stale sentiment) than incrementally negative news flow.”
Geopolitical tensions keep energy markets in focus
Markets also continued to react to developments in the Middle East after the United States carried out military operations against Iran for a ninth consecutive day.
Iran reported that two oil tankers had been disabled, while the Islamic Revolutionary Guards Corps said it had targeted U.S. military assets in Jordan, Kuwait and Syria. Bahrain also activated emergency warning sirens, highlighting the growing regional tensions.
The continuing conflict has increased uncertainty over shipping through the Strait of Hormuz, a key route for global oil and liquefied natural gas exports.
Oil prices extend gains
Brent crude climbed 2.8% to $90.56 per barrel, returning above the $90 mark, while U.S. West Texas Intermediate crude rose 2.3% to $84.39 per barrel.
The renewed rally has intensified concerns that higher energy prices could fuel inflation and encourage central banks to keep interest rates elevated for longer.
Moonshot AI eyes Hong Kong IPO
Bloomberg News reported that Chinese artificial intelligence company Moonshot AI is preparing for a potential Hong Kong listing within the next six months.
The company is also said to be completing a private fundraising round that could value the business at more than $30 billion, following strong investor interest in its Kimi K3 AI model.
SpaceX targets next Starship launch
SpaceX (NASDAQ:SPCX) said it aims to conduct the thirteenth test flight of Starship on Thursday after last week’s launch attempt was called off because of engine issues.
The mission will seek to complete a successful launch, stage separation and landing while deploying Starlink V3 satellites.
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