Dow Jones futures are up 0.4% in early trading, snapping a two-day losing streak. The rebound comes after the S&P 500 and Nasdaq Composite failed to hold critical support levels yesterday, triggering a wave of algorithmic selling that wiped out $200 billion in market cap overnight.
Traders are watching closely to see if this is a genuine bottom or just a dead cat bounce. The AI sector, which has driven much of the market’s recent gains, is under pressure as investors question the return on massive capital expenditures. With big tech earnings looming, the market is holding its breath.
Big Tech on Deck
Meta Platforms, Tesla, and SpaceX are the names on everyone’s lips this week. Meta reports earnings on Tuesday, with analysts expecting a detailed breakdown of their AI infrastructure spending. “The market is punishing companies that can’t show a clear path to monetizing their AI investments,” said Sarah Jenkins, a senior strategist at Meridian Capital. “If Meta’s capex numbers come in higher than expected without matching revenue growth, we could see another leg down.” Tesla, meanwhile, faces scrutiny over its robotaxi rollout and vehicle delivery numbers. SpaceX, though private, has seen its valuation chatter intensify as it prepares for potential pre-IPO disclosures.
Support Levels Matter
Technical analysts point to the 38,500 level on the Dow as the line in the sand. If futures can hold above this mark through the open, it signals that dip-buyers are stepping in. The VIX, or “fear index,” has dropped from its three-month high of 22.5 to 19.8, suggesting a slight calming of nerves. However, volume remains thin, and many traders are waiting for more data before committing capital. The next few days will determine whether the AI trade is dead or just taking a breather. If earnings disappoint, the support levels will likely break, opening the door to a deeper correction. For now, the market is betting on resilience.
Source: Yahoo Finance
This article was compiled by the IndiaBBCNews editorial system from verified international news sources. Facts have been independently reviewed. Original reporting: Yahoo Finance.
