Nasdaq futures slide as investors question AI stock valuations

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Nasdaq futures slide

Highlights

Nasdaq 100 futures fell 1.28%, leading losses among major U.S. index futures.
The Nasdaq Composite is coming off its first four-day losing streak since February.
Asian tech weakness spilled into U.S. premarket trading.
Investors are questioning AI valuations, chip supply, and infrastructure spending assumptions.

Nasdaq futures lead the decline

Contracts tied to the Nasdaq 100 fell 1.28% early in New York, while S&P 500 futures lost 0.51%. Dow Jones Industrial Average futures fell 0.16%, reflecting a broader rotation away from the most expensive technology companies and into less crowded areas of the market, CNBC reports.

The moves extended the pressure seen in Thursday’s regular session, when the Nasdaq Composite fell 0.46% and posted its first four-day losing streak since February. The S&P 500 slipped 0.01%, while the Dow gained 0.14%, helped by demand for healthcare, financial, and industrial shares.

The weakness was not confined to the U.S. South Korean shares were hit by a second trading halt this week as chipmakers plunged before recovering part of their losses. Other Asian technology names also declined, adding to the pressure on U.S. futures before the opening bell.

AI trade faces fresh scrutiny

The latest decline showed how fragile sentiment has become around the AI rally. Micron Technology’s strong outlook had briefly lifted confidence earlier in the week, but the optimism faded after Apple raised prices, intensifying concerns about rising component and memory costs.

Investors are now reassessing the assumptions behind the AI infrastructure cycle, including pricing, chip supply, and capital expenditure. The concern is not that demand for AI has disappeared, but that expectations for revenue growth and margins may have become too aggressive after a steep rally in chipmakers and related stocks.

The report that OpenAI was leaning toward delaying an initial public offering until 2027 added to the caution. The information fed into a broader debate over whether private-market AI valuations can support the scale of spending already being priced into listed technology companies.

Futures show a narrower market test

The decline in U.S. futures points less to a broad market breakdown than to a reassessment of the most crowded part of the equity market. The Nasdaq 100 remains about 28% above its March low, indicating that investor confidence remains intact.

Still, the index futures market is showing where investor confidence is most vulnerable. AI-linked stocks have carried much of this year’s gains, and even modest doubts about valuations, input costs, or capital spending can quickly weigh on Nasdaq futures. For now, the Dow’s relative strength suggests investors are rotating rather than exiting equities entirely, but the technology-led rally is facing a more demanding test.

As we previously reported, technology stocks slide as AI infrastructure costs unsettle investors.

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