U.S. stock futures rise while investors weigh trade and AI risks

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U.S. stock futures rise

Highlights

Dow futures rose 0.53%, while Nasdaq and S&P 500 futures also advanced.
New Trump tariffs of 10% to 12.5% officially took effect.
AI spending concerns continue to pressure major technology stocks.
Investors are watching PMI data and corporate earnings for direction.

Dow Jones futures rose 0.53% to 52,171, while S&P 500 and Nasdaq 100 futures gained 0.18% and 0.27% to 7,458.5 and 28,698.5, respectively. The advance signaled a cautious return to equities after one of the biggest technology-sector selloffs of the summer, Yahoo Finance reported.

Markets balance tariffs against tech concerns

The rebound followed a difficult session in which heavyweight technology stocks led a broad market decline. Investors reacted to fresh concerns over rapidly rising AI-related capital expenditures after earnings reports from Alphabet and Tesla highlighted another wave of aggressive spending on artificial intelligence infrastructure.

The weakness spread beyond Wall Street, with Japan's Nikkei 225 and South Korea's KOSPI also posting losses as global investors reassessed technology valuations.

At the same time, President Donald Trump's latest Section 301 tariffs officially took effect overnight. The measures impose duties of 10% to 12.5% on imports from many of the United States' largest trading partners. The administration exempted several energy products from the new tariffs in an effort to reduce inflationary pressure as oil prices remain elevated.

Brent crude slipped below $97 per barrel on Friday after briefly trading above $100, though the international benchmark remained on track for a solid weekly gain amid ongoing tensions in the Middle East.

Economic data and earnings in focus

Investors are also preparing for a busy day of economic releases, including S&P Global's preliminary July purchasing managers indexes for manufacturing and services, along with new home sales data. The reports are expected to provide fresh insight into the strength of the U.S. economy as higher borrowing costs continue to weigh on business activity.

Corporate earnings remain another key catalyst. American Express, Verizon Communications, and NextEra Energy are among the major companies scheduled to report quarterly results before the close, with investors looking for additional evidence that corporate profits can withstand slower economic growth and higher financing costs.

Investors search for stability

Friday's recovery suggests investors remain willing to buy after sharp declines, but broader market sentiment remains fragile. Higher Treasury yields, expensive technology valuations, geopolitical uncertainty, and the introduction of new trade tariffs continue to create crosscurrents for equities. With the major indexes still heading for weekly losses despite Friday's rebound, upcoming economic data and earnings reports are likely to determine whether markets can regain momentum or extend the recent pullback.

Earlier, we reported that Trump pledges response after Houthi strikes hit Saudi tankers.

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