Nasdaq 100 futures fall 2% to 28,975 as concerns over AI spending mount
Key Facts
Nasdaq 100 futures fell 2% to 28,975 in a report published by Investing.com at 09:08 on October 30, while S&P 500 futures declined 0.8% to 7,690.25. By contrast, Dow Jones futures rose 0.04% to 52,533, with the moves showing heavier pressure on technology-linked stocks. The losses followed disappointing earnings reports and outlooks from major companies, as investors monitored the scale of AI spending and the returns those investments could generate. Reuters linked the decline to concerns that massive and rising AI spending may not deliver sufficient returns. Reuters put the decline in Nasdaq 100 futures at 1.9% in its report, while Investing.com reported a 2% drop at its timestamp.
Amazon’s results were a key source of pressure, as the company missed revenue and earnings estimates for the September quarter, according to the market report. The report said heavy AI spending pushed free cash flow further into negative territory. Amazon’s free cash flow was negative $42.4 billion in the 12 months ended September 30, 2026, according to Axios, citing the company’s announcement. Reuters said Amazon shares fell 7% after the results, amid investor concerns about cash burn. That puts quarterly results and spending projections at the center of the market’s assessment of technology investments’ ability to generate returns. The report did not give figures for the revenue or earnings estimates the company missed.
In the semiconductor sector, Intel shares fell about 23% in after-hours trading after the company reported third-quarter results. Despite strong earnings for the quarter, disappointing fourth-quarter guidance overshadowed them, while third-quarter revenue also came in below estimates, according to Investing.com. The decline reflects the market’s focus on the expected trajectory of the business as much as on results already delivered. Reuters said Intel’s 23% share drop, alongside the fall in Amazon, pushed Nasdaq 100 futures lower. In the previous session, the Nasdaq Composite lost 1.4% under pressure from a 12.6% drop in shares of Google’s parent company, according to Investing.com. That earlier performance added to the pressure facing futures as companies reported results.
Alongside corporate news, the Federal Reserve on October 28 kept its target interest rate range at 3.75% to 4%, with the decision passing by a 10-to-2 vote. Lisa Cook and Beth Hammack voted against holding rates steady, preferring a quarter-percentage-point increase in the target range at that meeting. After the decision, Investing.com reported that investors largely maintained their bets on a December rate hike. The report linked those bets to stronger-than-expected growth and inflation data, as well as remarks by the Fed chair. The personal consumption expenditures price index rose 3.6% year over year in September, while the core index, excluding food and energy, increased 3.1%. On a monthly basis, the headline index accelerated to 0.5% in September from 0.3% in August, while the core index remained at 0.3% in both months.
The inflation readings coincided with the U.S. economy growing at an annual rate of 3.4% in the third quarter, compared with growth of 2.2% in the second quarter, according to the Bureau of Economic Analysis’ advance estimate. Increases in investment, consumer spending and government spending contributed to output growth, while a decline in exports offset them. Growth and inflation data were central to the report’s explanation of why investors held on to December rate hike bets, despite the Fed leaving its target range unchanged at its latest meeting. The next economic updates include the Institute for Supply Management’s manufacturing purchasing managers’ index report on November 2 at 10:00 a.m. Eastern time. The report follows inflation and growth data that bolstered rate bets, while the U.S. October jobs report is due on November 6 at 08:30 a.m. Eastern time. The Bureau of Economic Analysis has set November 25 for the next release of personal income and spending data.