US stock futures edged higher on Monday as investors attempted to stabilise markets after last week’s semiconductor-led retreat, with a packed technology earnings calendar set to determine whether the AI rally still has room to run.
Dow, S&P 500 and Nasdaq 100 contracts posted modest gains in early New York trading, but confidence remained fragile after the Philadelphia Semiconductor Index entered a bear market.
Alphabet, Tesla, IBM and Intel report this week, placing AI spending, margins and guidance under scrutiny.
Brent crude’s earlier move above $90 also kept inflation and geopolitical risks firmly in view before the opening bell today.
5 things to know before Wall Street opens
1. Futures recover, but conviction remains thin
S&P 500 contracts edged 0.3% higher while Nasdaq 100 futures gained 0.6%. Dow futures added 131 points, also advancing 0.3%.
The advance followed sharp weekly declines across the main indexes as investors cut exposure to crowded semiconductor trades.
The modest bounce suggests bargain hunting rather than a decisive return of risk appetite.
2. Alphabet becomes the first hyperscaler test
Alphabet and Tesla report after Wednesday’s close, while IBM is also due that day and Intel follows later in the week.
Alphabet’s results carry particular weight because its data-centre spending will show whether hyperscalers remain willing to fund the AI buildout despite questions about returns.
Tesla’s rising investment in robotics and AI will face similar scrutiny.
3. The semiconductor index is in a bear market
The Philadelphia Semiconductor Index ended Friday 20.2% below its June 22 record after losing about 10% last week. That decline has transformed the earnings debate.
Investors are no longer asking only whether chip demand is growing, but whether growth can justify valuations after a powerful first-half rally.
XTB research director Kathleen Brooks said the correction could continue if earnings show companies are still spending heavily without delivering clearer returns.
Guidance on margins, capital expenditure and customer demand may matter more than backward-looking profit beats.
4. Rate bets remain sensitive to oil
Soft US consumer and producer inflation reduced the chance of a July Fed increase to about 12%, though markets still assigned roughly even odds to a September move.
Brent briefly topped $90 as US strikes on Iran continued and shipping through the Strait of Hormuz slowed, reviving concern that energy costs could undo some of the recent inflation relief.
5. Hormuz risk keeps investors defensive
The latest escalation has weakened hopes that Middle East energy flows will normalise quickly.
Any prolonged disruption around Hormuz could push fuel prices higher, lift Treasury yields and raise the valuation hurdle for technology shares.
For Wall Street, the week’s central question is straightforward: can strong earnings restore confidence in AI leaders before oil and interest-rate risks trigger a broader retreat?
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