US Stock Futures Dip After Wall St Tumbles On Market Bubble Fears
Olivia BrooksU.S. stock futures inched lower on Tuesday evening after Wall Street suffered broad losses, as top bank executives warned of a looming market correction and investors grappled with deepening uncertainty around Federal Reserve policy....
U.S. stock futures inched lower on Tuesday evening after Wall Street suffered broad losses, as top bank executives warned of a looming market correction and investors grappled with deepening uncertainty around Federal Reserve policy.
S&P 500 Futures inched 0.2% lower to 6,789.0 points, while Nasdaq 100 Futures fell 0.4% to 25,487.0 points by 19:28 ET (00:28 GMT). Dow Jones Futures edged up 0.1% to 47,252.0 points.
Bank CEOs stoke market bubble fears
In Tuesday's regular session, the S&P 500 slipped 1.2%, and the NASDAQ Composite dropped over 2%, while the Dow Jones Industrial Average fell 0.5%.
The slide came after Morgan Stanley (NYSE:MS) and Goldman Sachs (NYSE:GS) chiefs sounded alarm bells over overheated valuations and speculative trading in technology shares.
Morgan Stanley CEO Ted Pick said markets could face a drawdown of 10 %–15 %, adding that such a pullback would be a healthy normalization after months of exuberance driven by artificial-intelligence optimism.
Goldman Sachs CEO David Solomon echoed those concerns, warning that the surge in mega-cap tech stocks had created "bubble-like dynamics" that were unsustainable without stronger earnings support.
Their remarks stoked investor anxiety that Wall Street's rally, powered by the "Magnificent Seven" tech giants, may be approaching a breaking point. Several of those companies have seen market capitalizations soar to record highs this year, fueling fears of excessive concentration risk.
The warnings came as investors also faced growing uncertainty about the Fed's next policy steps. A prolonged government shutdown has left key economic data releases unavailable, depriving policymakers and traders of crucial signals about the state of the economy.
Fed officials on Monday added to the confusion. Some policymakers suggested that the central bank could consider another cut in December if inflation continues to cool, while others argued that strong job growth and resilient demand meant policy should stay restrictive for longer.
AMD slips despite profit beat; Pinterest tumbles 20%
In extended trading, several tech names slumped following quarterly results. Advanced Micro Devices (AMD) (NASDAQ:AMD) dropped over 3% despite topping profit estimates, as Amazon said that it dissolved its stake in the chipmaker.
Pinterest (NYSE:PINS) tumbled roughly 20% after its quarterly revenue guidance fell short of expectations, stoking worries about a slowdown in digital advertising.
Super Micro Computer (NASDAQ:SMCI) slid 9% after issuing bleak guidance, with analysts flagging near-term delivery delays in its AI server business.
