Markets
Nasdaq Futures Fall as Alphabet Results Revive AI Spending Worries Ahead of GDP and Inflation Data
Image: aled7 via Pixabay
Dow futures edge higher while chip and software stocks slide premarket; third-quarter GDP and September PCE inflation are due this morning.
By Emma Cruz ·
U.S. stock index futures split in early trading on Thursday, with technology shares under pressure after Alphabet's quarterly results renewed concerns about the cost of the artificial intelligence buildout, while blue-chip futures edged higher ahead of a busy morning of economic data and earnings.
As of 5:18 a.m. ET, Nasdaq 100 E-minis were down 1.01%, S&P 500 E-minis were off 0.26% and Dow E-minis were up 0.51% [1]. Alphabet shares fell 10.2% in premarket trading after weak search advertising results and a jump in cash burn tied to AI spending, a decline that could erase more than $400 billion of market value if it holds [1]. Microsoft, which reported at the same time, rose 3.6% premarket after a large beat on cash flow and a strong cloud growth forecast [1].
The contrasting moves suggest investors are starting to separate large AI spenders by how well their cash generation covers the buildout. "Some investors are no longer giving all hyperscalers a 'free pass' to spend without limit," said Jeremy Saltzberg of Check Capital Management [1].
Chipmakers were among the early laggards. Micron fell 3.3%, Intel 3.7% and AMD 2.8%, while Nvidia slipped about 0.7% [1]. Marvell Technology dropped 9.7% on reports that it is in advanced talks to buy Lumentum, whose shares rose 4.2% [1]. Software names were hit hard after their own results: Fortinet sank 25% and ServiceNow fell 18.2% after missing third-quarter profit estimates [1]. On the upside, Carvana gained 7.8% after revenue beat estimates and Chipotle rose 6.7% on better-than-expected comparable sales [1].
The AI-related selling spread through parts of Asia overnight [2]. South Korea's Kospi fell 1.2% to 5,937.66 and Taiwan's Taiex lost 1.4%, while Samsung Electronics dropped 4.1% despite strong quarterly results [3]. Japan's Nikkei 225 bucked the trend, rising 1.1% to 64,659.47, and Hong Kong's Hang Seng slipped 0.2% [3].
Rates remain a central concern. The Federal Reserve held its benchmark target range at 3.75% to 4% on Wednesday in a 10-2 vote, with Lisa Cook and Beth Hammack dissenting in favor of a quarter-point increase [4]. CME FedWatch data showed more than an 81% chance of a rate hike in December [1]. The 10-year Treasury yield stood near 5.00% in Asian trading after briefly touching about 5.04% on Wednesday, and the two-year yield was about 4.69% [3]. U.S. crude slipped 0.8% to $101.96 a barrel and Brent fell 0.6% to $110.94 [3].
Thursday's data could sharpen that debate. The first estimate of third-quarter GDP is expected to show annualized growth of 3.2%, up from 2.2%, according to the consensus figures compiled by Yahoo Finance [2]. September's personal consumption expenditures price index, the Fed's preferred inflation gauge, is expected to show headline inflation rising to 3.6% year over year from 3.4% and the core measure rising to 3.1% from 3.0% [2]. Weekly jobless claims are also due [2]. The European Central Bank announces its own policy decision later on Thursday [3].
Earnings remain heavy. Merck, Eli Lilly, Caterpillar, Ares Management and Blue Owl were scheduled to report before the opening bell, with Intel and Amazon due after the close [1]. Amazon's results in particular will test whether investors reward or punish another large AI spender, after reacting so differently to Microsoft and Alphabet.
Sources:
[1] Reuters via Yahoo Finance, "Nasdaq futures fall 1% as Alphabet results intensify AI spending fears", October 29, 2026. https://finance.yahoo.com/markets/stocks/articles/nasdaq-futures-slide-mixed-big-083556706.html
[2] Yahoo Finance, "Stock market today: Dow rises, S&P 500 and Nasdaq futures fall as Alphabet stock sells off, AI jitters return", October 29, 2026. https://finance.yahoo.com/markets/live/stock-market-today-thursday-october-29-dow-sp-500-nasdaq-alphabet-microsoft-081708101.html
[3] Associated Press, "Asian shares and U.S. futures are mixed after Google parent Alphabet's earnings disappoint", October 29, 2026. https://www.ksat.com/business/2026/10/29/asian-shares-and-us-futures-are-mixed-after-google-parent-alphabets-earnings-disappoint/
[4] Federal Reserve, "Federal Reserve issues FOMC statement", October 28, 2026. https://www.federalreserve.gov/newsevents/pressreleases/monetary20261028a.htm
This article was produced with AI assistance. It is for informational purposes only and is not financial advice. StockVolt and its authors may hold positions in securities mentioned.