U.S. stock futures indicate a softer start to Tuesday’s session, with equities poised to decline as trading resumes after the extended Presidents’ Day break.
Technology shares appear set to remain under pressure, underscored by a 0.9% drop in Nasdaq 100 futures.
Mounting concerns over the rapid expansion of artificial intelligence infrastructure have recently prompted investors to trim exposure to major tech stocks, which had previously driven the broader market to record highs.
“Investors are increasingly questioning whether the marginal dollar spent on AI will generate the expected return,” said Daniela Hathorn, Senior Market Analyst at Capital.com. “At the same time, market uncertainty is rising as new AI models frequently disrupt established players.”
“With competitive dynamics evolving rapidly, it is unclear who the long-term winners will be,” she added. “This uncertainty has led to underperformance across much of big tech, even as the broader market remains relatively resilient.”
Overall activity could remain muted as traders await a series of significant economic releases later this week.
The upcoming report on December personal income and spending is likely to draw particular focus, as it includes the Federal Reserve’s preferred inflation measures.
Investors will also look to the minutes from the Fed’s most recent policy meeting for further signals on the future direction of interest rates.
On Friday, stocks struggled to find direction early in the day, gained traction in the afternoon, and then slipped back before the close. The major indices ultimately finished little changed and mixed.
The Nasdaq shed 50.48 points, or 0.2%, closing at 22,546.67, extending Thursday’s sharp decline. The S&P 500 added 3.41 points, or 0.1%, to end at 6,836.17, while the Dow Jones Industrial Average rose 48.95 points, or 0.1%, to 49,500.93.
For the week, the Nasdaq fell 2.1%, while the S&P 500 and Dow posted losses of 1.4% and 1.2%, respectively.
The uneven trading came despite the release of January’s closely watched consumer inflation report from the Labor Department.
The data indicated that consumer prices rose slightly less than anticipated on a monthly basis, and annual inflation slowed more than expected.
The consumer price index increased 0.2% in January following a 0.3% rise in December. Economists had projected another 0.3% gain.
Year-over-year inflation eased to 2.4% from 2.7%, coming in below expectations of 2.5%.
Core prices, which exclude food and energy, climbed 0.3% in January after a 0.2% increase the prior month, in line with forecasts.
On an annual basis, core inflation slipped to 2.5% from 2.6%, matching estimates.
The softer headline inflation reading revived hopes that the Federal Reserve may continue easing policy, contributing to further declines in Treasury yields.
“This print strengthens the case that the Federal Reserve can maintain a gradual easing bias without fearing renewed inflation pressure,” said Daniela Hathorn, Senior Market Analyst at Capital.com.
She added, “Importantly, while the labor market remains resilient, today’s CPI reduces the risk that strong employment data forces the Fed into a hawkish rethink.”
Even so, anxiety about the potential fallout from the rapid AI buildout continued to dampen sentiment and limit buying enthusiasm.
“Some are concerned about excessive levels of spending and others fear AI will disrupt multiple industries,” said Russ Mould, investment director at AJ Bell. “It all adds up to a cocktail of worries and that’s bad for market sentiment more broadly.”
Despite the broader market’s subdued tone, gold-related shares rallied sharply alongside gains in the underlying metal, lifting the NYSE Arca Gold Bugs Index by 5.6%.
Computer hardware stocks also posted solid advances, with the NYSE Arca Computer Hardware Index climbing 2.7%.
Strength was further seen in networking, utilities, natural gas, and transportation shares, while steel stocks declined following reports that President Donald Trump may roll back tariffs on steel and aluminum.
