❓WHAT HAPPENED: U.S. stock futures dropped on Tuesday amid concerns over an artificial intelligence (AI) bubble, with Nvidia earnings and delayed jobs data in focus.
👤WHO WAS INVOLVED: Dow Jones, Nasdaq, S&P 500, Nvidia, Bitcoin, and major retailers like Home Depot, Walmart, and Target.
📍WHEN & WHERE: Tuesday, across U.S. and Asian financial markets.
💬KEY QUOTE: “Bitcoin’s extended selloff has definitely amplified the market’s risk alarm, reinforcing the sense that something deeper may be shifting under the surface.” – Hebe Chen, Vantage Markets Analyst
🎯IMPACT: Stock market losses, a Bitcoin slump, and shifts in investor sentiment ahead of critical economic data and earnings reports.
American markets were roiled on Tuesday as stock futures plunged over fears of an artificial intelligence (AI) bubble and a continued slide in the value of Bitcoin. Futures for the Dow Jones Industrial Average fell 0.7 percent, while the tech-heavy Nasdaq 100 slid 0.8 percent, and the S&P 500 fell 0.6 percent. The falling futures marks the worst three-day run for the Dow since April.
Bitcoin also experienced a sharp decline, briefly falling below $90,000 for the first time in seven months. The cryptocurrency‘s slump erased all its gains for the year and triggered alarm in Asian markets, where Japanese stocks logged their worst loss since April. The MSCI Asia Pacific Index fell more than two percent, with nearly all regional markets in the red.
Investors are closely watching Nvidia‘s upcoming earnings report on Wednesday, as it could provide insight into the sustainability of this year’s AI-driven market rally. Additionally, the delayed September jobs report, set to release on Thursday, is expected to shape expectations for the Federal Reserve’s next moves and whether an additional rate cut could be enacted at the central bank’s December Federal Open Market Committee (FOMC) meeting.
Retailers are also in focus, with Home Depot cutting its full-year profit guidance after missing earnings estimates, causing its shares to drop nearly four percent. Results from Walmart and Target are expected later this week, providing further insights into consumer strength ahead of the holiday season. Notably, a substantial decline in consumption—signaling a demand collapse—could be a key indicator of a deflationary cycle and an economic recession.
Meanwhile, analyst Hebe Chen from Vantage Markets commented on Bitcoin’s selloff, stating, “Bitcoin’s extended selloff has definitely amplified the market’s risk alarm, reinforcing the sense that something deeper may be shifting under the surface.” The cryptocurrency’s decline contributed to pressure on risk-sensitive assets and currencies, while haven assets like the yen and Swiss franc strengthened.
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