Nasdaq futures lag as Alphabet, AMD slide after bleak forecasts

NEW YORK: US stock index futures dipped on Wednesday, with the Nasdaq particularly impacted as shares of Alphabet and AMD fell following subdued forecasts, while negative earnings reactions in other sectors compounded losses.

Google-parent Alphabet dropped 7.5 per cent in premarket trading after posting a deceleration in cloud revenue growth, missing analysts’ expectations.

The company also said it would spend $75 billion on its AI buildout this year, 29 per cent higher than Wall Street expected.

Advanced Micro Devices lost 8.2 per cent after Chief Executive Lisa Su said the company’s data center sales – a proxy for its AI revenue – in the current quarter would be down about 7 per cent from the just-ended quarter.

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Meanwhile, Apple shed 2.5 per cent after Bloomberg News reported that China’s antitrust regulator was preparing for a possible investigation of the iPhone maker.

Entertainment giant Walt Disney ride-hailing platform Uber and global grains merchant Bunge are among prominent companies scheduled to report earnings before markets open.

At 04:49 am ET, Dow E-minis were down 153 points, or 0.34 per cent, S&P 500 E-minis were down 40.5 points, or 0.67 per cent, and Nasdaq 100 E-minis were down 227.5 points, or 1.05 per cent.

All three major Wall Street indexes closed higher on Tuesday, with energy shares outperforming, while an earnings-driven move in Palantir spurred gains in technology shares.

A January private payrolls reading is due at 8:15 am ET, while a survey on US services activity for the month is due shortly after the open.

The all-important January nonfarm payrolls report is expected to be released on Friday.

Markets also looked for developments on the tariffs front. U.S. President Donald Trump said on Tuesday that he was in no hurry to speak to Chinese President Xi Jinping to try to defuse a new trade war between the countries, sparked by sweeping 10% U.S. tariffs on all Chinese imports.

Many analysts have noted that Trump’s tariffs could raise domestic inflation, with markets continuing to price in fewer interest-rate cuts by the US Federal Reserve this year.

However, markets appeared to shrug off Trump’s controversial statement that the United States would take over war-ravaged Gaza and create a “Riviera of the Middle East” after resettling Palestinians elsewhere.

Fed Vice Chair Philip Jefferson as well as San Francisco Fed President Mary Daly commented on Tuesday, reiterating the central bank’s message that policymakers needn’t rush into their next rate cut.

Comments from four Fed heads including Richmond Fed President Thomas Barkin will be on the radar through the day.

In other moves, FMC Corp plunged 20.7 per cent after the agrichemicals producer forecast first-quarter revenue below estimates.

Chipotle Mexican Grill slid 6.8 per cent after the burrito maker forecast tepid annual comparable sales growth and said that if Trump’s proposed tariffs against Mexico went into full effect, the company would take a roughly 60-basis-point impact on its raw material costs this year.

Tinder-parent Match Group tumbled 8.9 per cent after it forecast annual revenue below Wall Street estimates.