US stock futures were mixed on Tuesday as investors assessed renewed concerns about artificial intelligence valuations, weaker-than-expected sales from luxury group LVMH and the approaching release of quarterly results from major Wall Street banks.
Geopolitical tensions in the Middle East and uncertainty surrounding oil supplies also remained important factors, while markets awaited US inflation data that could influence the Federal Reserve’s interest rate decisions during the remainder of 2026.
Dow Jones Industrial Average futures rose 225 points, or 0.4%, by 02:48 ET (06:48 GMT), while S&P 500 futures slipped six points, or 0.1%. Nasdaq 100 futures declined 237 points, equivalent to 0.8%, reflecting continued pressure on technology shares.
The mixed performance followed an uneven session on Wall Street on Monday, when investors weighed concerns about the sustainability of artificial intelligence investment against rising energy prices and disappointing corporate updates.
Technology Shares Weaken Amid Questions Over AI Investment Returns
Technology stocks remained under pressure following losses among US semiconductor manufacturers at the beginning of the week.
An index tracking the semiconductor industry declined 2.7% on Monday, reflecting weaker sentiment towards companies exposed to artificial intelligence infrastructure spending.
The selling extended into Asian markets, where South Korean technology shares experienced substantial declines.
Reports of technological advances by Chinese memory chip manufacturer ChangXin Memory Technologies contributed to concerns about increasing competition between US and Chinese semiconductor companies.
Investors are assessing whether technological progress among Chinese manufacturers could narrow the competitive advantages held by established suppliers in the artificial intelligence market.
Concerns about the sector have also been influenced by questions surrounding revenue expectations at OpenAI, the developer of ChatGPT.
Although demand for artificial intelligence technologies remains substantial, uncertainty persists over the financial returns that companies will generate from their investment programmes.
Major technology businesses are committing significant capital to data centres, semiconductor equipment and computing infrastructure, with some expenditure supported by borrowing.
The scale of these investments has increased scrutiny of future profitability and the ability of AI-related revenue growth to justify current valuations.
LVMH Shares Fall After Third-Quarter Sales Miss Expectations
Shares in luxury goods group LVMH (USOTC:LVMUY) declined in early Paris trading after the company reported third-quarter revenue below market expectations.
The group recorded revenue of €18.5 billion, representing organic growth of 1% compared with the same period a year earlier.
Analysts had expected organic growth of approximately 1.3%, according to Visible Alpha consensus estimates cited by Reuters.
The weaker-than-expected performance reflected continued difficulties in the Chinese luxury market, alongside softer demand for some of the group’s principal fashion brands.
LVMH’s fashion and leather goods division, which accounts for approximately half of total group revenue, recorded a 5% decline in organic sales.
That compared with analysts’ expectations for a contraction of approximately 1.8%.
Growth in the group’s watches and jewellery business also moderated during the quarter.
Across Asia, where China represents a major market for luxury products, revenue declined 5% year on year.
The downturn reflected weaker spending among Chinese consumers, with increased scrutiny of wealthy individuals’ tax affairs adding to uncertainty in the luxury goods market.
Higher operating costs associated with geopolitical tensions have also presented challenges for luxury companies.
LVMH’s results added to concerns about the pace of recovery in global demand for high-end products, particularly in China.
The figures may influence expectations for other European luxury goods manufacturers as investors assess consumer spending trends and the outlook for discretionary purchases.
Wall Street Banks Prepare to Report Third-Quarter Results
Investor attention was also turning towards the start of the US corporate earnings season, with several major financial institutions scheduled to release their third-quarter results on Tuesday.
JPMorgan Chase (NYSE:JPM), Goldman Sachs (NYSE:GS), Wells Fargo (NYSE:WFC) and Citigroup (NYSE:C) were among the banks expected to publish their latest financial statements.
The reporting calendar continues on Wednesday with results from Bank of America (NYSE:BAC), Morgan Stanley (NYSE:MS) and BlackRock (NYSE:BLK).
The figures will provide information about lending profitability, deposit costs, credit quality and activity in capital markets.
Investors will be particularly interested in how higher bond yields have affected banks’ net interest margins and the valuations of their fixed-income portfolios.
Analysts at Vital Knowledge suggested that third-quarter results could broadly meet market expectations, although several risks remain.
The firm highlighted concerns about rising yields, weaker securities issuance and market volatility, which could affect investment banking fees and other capital markets revenue.
Income linked to residential mortgages could also face pressure.
Investment banking activity will be closely monitored for indications of whether corporate transactions, debt issuance and initial public offerings are recovering or remaining subdued.
In a separate assessment, Deutsche Bank analysts forecast third-quarter earnings growth of 34% for the broader S&P 500.
The bank suggested that consensus estimates may be too cautious, leaving room for companies to report results above expectations.
Corporate earnings will therefore be an important influence on market sentiment, particularly as investors assess whether profit growth can support current equity valuations.
Oil Prices Decline as Russian Supply Prospects Offset Middle East Risks
Oil prices moved lower on Tuesday following comments from Russia suggesting that diesel exports could exceed previously announced volumes under a supply arrangement with the United States.
Brent crude futures fell 1.5% to $105.09 per barrel by 03:54 ET, while West Texas Intermediate futures declined 1.8% to $92.08 per barrel.
Both contracts had risen during Monday’s session, with Brent settling at its highest level since 15 September.
Russian Deputy Prime Minister Alexander Novak said late Monday that the country could restore diesel exports to levels above those outlined in the agreement announced by US President Donald Trump.
The comments followed Trump’s announcement that his administration had temporarily eased sanctions affecting Russian fuel.
Trump also announced what he described as an “energy ceasefire” between Russia and Ukraine.
However, uncertainty remained over the durability of the arrangement following reports of additional Russian strikes against Ukrainian energy infrastructure.
Meanwhile, developments in the Middle East continued to pose risks to international oil supplies.
Attacks attributed to Iran-backed Houthi forces on Saudi Arabia’s international airport, alongside strikes targeting tankers in the Strait of Hormuz, contributed to concerns about the security of regional energy transport routes.
The Strait of Hormuz remains a strategically important passage for international oil shipments, making disruptions in the area particularly significant for global energy markets.
Although the prospect of additional Russian supply weighed on prices during Tuesday’s session, geopolitical risks continued to influence expectations for crude oil availability.
The competing effects of potential supply increases and continuing Middle Eastern disruptions contributed to uncertainty in energy markets.
Looking ahead, investors will be monitoring the results of major US banks, forthcoming inflation figures, developments in the artificial intelligence sector and changes in global oil supply conditions.
Together, these factors will help determine market expectations for corporate profitability, interest rates and equity valuations during the remainder of the year.
