U.S. Stock Futures Fall as AI Shares Extend Losses and Geopolitical Risks Weigh on Markets

U.S. stock index futures traded lower on Monday as renewed weakness across artificial intelligence-related companies and continued geopolitical tensions in the Middle East weighed on investor sentiment.

Futures linked to the S&P 500 declined 0.3%, while Nasdaq 100 futures fell more than 1%. Contracts tied to the Dow Jones Industrial Average were little changed.

Technology stocks led the decline, with semiconductor companies remaining under pressure as investors assessed whether the sector can sustain the growth expectations that have driven its rally over the past year.

U.S.-listed shares of SK Hynix dropped 8% in premarket trading after a South Korean brokerage reportedly warned the company could fall short of expectations in its next earnings report. The decline followed a 13% gain in the stock during Friday’s session.

Other semiconductor companies also traded lower before the opening bell. Nvidia, AMD and Intel each fell more than 1%, while memory chip makers Sandisk and Micron Technology lost more than 3%.

Broader market sentiment was also affected by ongoing military exchanges between the United States and Iran, which continued to raise concerns about disruptions to Middle East energy exports. Higher oil prices have renewed attention on potential inflationary pressures and the prospect of elevated borrowing costs.

Investors are also preparing for the start of earnings season for major U.S. banks. Shares of JPMorgan Chase and Bank of America traded near unchanged ahead of their quarterly financial results, which are scheduled for release on Tuesday.

The combination of pressure on technology shares, geopolitical uncertainty and the upcoming earnings season has kept investors focused on whether corporate results and economic conditions will support current market valuations in the weeks ahead.