Wall Street futures subdued as tech wobbles again; Tesla gains
The AI stocks sell-off have sparked a rotation into defensive sectors such as healthcare on Thursday
Sudeshna Dhar
[WASHINGTON] US stock index futures were muted on Friday (Oct 16), as tech stocks came under fresh pressure on worries about cracks building in the artificial intelligence trade, though a rise in Tesla shares and decline in oil prices offered support.
The electric-vehicle maker rose 3 per cent in premarket trading after unveiling a redesigned Roadster, powered by rocket-style thrusters, developed in collaboration with SpaceX.
Elon Musk’s rocket and space technology company gained 1.2 per cent.
Cautionary signs persisted in the AI sector as Nvidia-backed CoreWeave slipped 5.2 per cent after Thursday’s rebound, on lingering concerns about the data-centre operator’s debt load.
Other neocloud companies Nebius Group and Iren dipped more than 2.8 per cent each, while chipmakers Micron Technology and Intel fell 2.6 per cent and 1.4 per cent, respectively.
Reuters reported, citing people familiar with the matter, that some current and prospective investors in Anthropic’s upcoming initial public offering are weighing a lower valuation, amid broader concerns over ballooning AI financing costs.
AI stocks have cratered this week as investors who have crowded into bets all along the AI supply chain worry that data-centre operators might not turn profitable in time to repay debts, particularly with borrowing costs expected to rise.
Some of these stocks have risen sharply in 2026, helping push benchmarks S&P 500 and Nasdaq to record highs as recently as last week.
“When you’ve this incredibly bullish narrative matched with incredibly bullish outcomes but the stock declines, that is the sort of technical signal that tells you there’s too many people in the pool,” said James Athey, fixed-income portfolio manager at Marlborough.
The sell-off in AI stocks sparked a rotation into defensive sectors such as healthcare on Thursday, helping the main indexes close slightly higher.
The S&P 500 and Nasdaq were set to post weekly losses as an AI-led rout, mixed earnings from big banks and inflation data weighed on sentiment through the week.
The Dow, however, remained on track for a weekly advance.
At 7.51 am ET, Dow E-minis were down 20 points, or 0.04 per cent, S&P 500 E-minis were up 3.5 points, or 0.04 per cent, and Nasdaq 100 E-minis were down 84 points, or 0.28 per cent.
A nearly 1 per cent fall in oil prices offered some support, though Brent crude remained above the US$100-a-barrel mark.
Hotter-than-expected consumer and producer inflation reports this week have confirmed that price pressures are broadening out beyond energy products.
Federal Reserve chair Kevin Warsh also noted that a spending surge was boosting inflation. He, however, said the US economy remained resilient and was benefiting from an AI-driven investment boom.
Markets increasingly expect the Fed to keep interest rates unchanged in October.
Among other movers, property-casualty insurer Travelers dropped 4 per cent after reporting third-quarter results. Varonis Systems climbed 2.6 per cent as Thoma Bravo’s Proofpoint agreed to buy the data security company in a US$6.3 billion all-cash deal. REUTERS
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