S&P 500 Futures Slip Less Than 0.1% Ahead of U.S. Midterm Elections
Key Facts
S&P 500 futures slipped less than 0.1% on Tuesday morning, November 3, ahead of the U.S. midterm elections, while Nasdaq Composite futures rose 0.25%, according to the Associated Press. The limited moves reflected a divergence among stock indexes at the start of a day combining voting, corporate results and energy risks. Brent crude rebounded nearly 2% to $106.50 a barrel after falling about 8% on Monday, the agency reported. The oil move followed U.S. strikes on Qeshm Island, as developments in the Strait of Hormuz remained in focus for markets. The Republican and Democratic parties were competing for control of Congress and state governorships, and the election result could reshape the final two years of President Donald Trump’s term, according to the Associated Press.
Monday’s session had shown volatility in U.S. stocks: the S&P 500 ended trading down 0.5% after erasing an early gain of 1.1%. The Dow Jones Industrial Average rose 0.4%, while the Nasdaq Composite fell 1.1%, according to the Associated Press. The agency linked the stock decline to Brent’s 7.6% drop to $104.77 a barrel in the same session. Since before the start of the war with Iran, the most actively traded Brent contract has fluctuated between about $70 and $120 a barrel, according to the agency. That range puts Tuesday’s move in the context of broader energy volatility, with regional developments continuing to affect oil trading.
In Asian markets, the broader MSCI index of regional shares excluding Japan fell 1.4% to its lowest level in a week and a half during Tuesday trading, according to Reuters. South Korean shares led the decline, falling as much as 4.1%, while Taiwanese shares fell 3.6%. The losses in Taiwanese shares extended to 13.3% from their record peak reached in early October, Reuters reported. S&P 500 E-mini futures also fell 0.1% for a fourth consecutive day, while regional European futures dropped 0.9% in early trading. U.S. and European futures thus started weakly, alongside declines in Asian shares.
Markets are also tracking technology company results and the cost of investment in artificial intelligence. The Associated Press said concerns are mounting that big technology companies’ massive spending on AI data centers may not generate enough productivity and profits to justify the cost. In this context, Palantir shares fell 8% in premarket trading after the company’s U.S. commercial bookings slowed, according to the agency. Apple reported quarterly revenue of $114.5 billion, up 12% year over year, and a gross margin of 47.9% for the fiscal fourth quarter ended September 26, the company said. Reuters said earnings and iPhone sales beat expectations, but the stock fell after the close after the company pointed to lower margins under pressure from chip component prices.
Reuters reported that Apple shares fell 2.8% in after-hours trading on Monday after the company forecast a lower gross margin during the holiday season because of higher memory chip costs. In politics, opinion polls pointed to a Democratic win in the House of Representatives, while the Senate race remained too close to call. Prediction markets put the Democrats’ probability of controlling the chamber at 77% on Polymarket and 76% on Kalshi, according to Reuters. On regional tensions, a U.S. official said the United States had carried out strikes it described as defensive against Iranian targets in the Strait of Hormuz. Iranian state media reported hearing explosions on Qeshm Island, according to the Associated Press.
Regional officials said Israeli Prime Minister Benjamin Netanyahu is pushing for a new wave of strikes on Iran after Tuesday’s election, while mediators are working on a framework to halt Iranian attacks in the Strait of Hormuz in exchange for Washington lifting its blockade of Iranian ports, according to the Associated Press. As for economic data, the Bureau of Labor Statistics scheduled the release of its September Job Openings and Labor Turnover report for November 3 at 10:00 a.m. Eastern time. The latest available report showed job openings steady at 7.1 million and hires at 5.2 million in August, while total separations remained at 5.1 million. The October jobs report is scheduled for release on November 6 at 8:30 a.m. Eastern time, according to the bureau’s calendar. The bureau also scheduled the release of its October job openings report for December 1 at 10 a.m., according to its published calendar.