US stock futures moved higher on Tuesday as Wall Street looked to extend Monday’s AI-driven rally, which pushed the Nasdaq Composite to a record close.
Dow futures gained 170 points, or 0.32%, while S&P 500 futures rose 0.12% and Nasdaq 100 futures advanced 0.14%.
Investors are balancing enthusiasm around Meta’s Muse AI assistant against Brent crude falling below $100 on hopes Iran could reopen the Strait of Hormuz, while Treasury yields remain close to levels that pressure expensive growth stocks.
Attention also turns to AutoZone earnings, fresh ADP jobs data and several Fed speakers.
5 things to know before Wall Street opens
1. AI stocks cool after Monday’s record surge
Monday’s rally lifted Meta 11.3%, AMD almost 10% and Intel more than 12%. AMD also crossed $1 trillion in market value for the first time.
Premarket trading is more selective. Meta added about 0.5% and Alphabet rose 0.8%, while Nvidia slipped 0.2% and US-listed TSMC and SK Hynix fell more than 1%.
Tickmill strategist Patrick Munnelly told MarketWatch that investors still appear willing to take risk, but leadership is narrowing around AI and market breadth matters more with central banks turning hawkish and long-term yields elevated.
2. Oil below $100 is giving bonds some relief
Brent fell to about $99.45 after reports that Iran could reopen the Strait of Hormuz within seven days if Washington eases military pressure. The route normally handles close to one-fifth of global oil and LNG trade.
The move pushed the 10-year Treasury yield down about 2.4 basis points to 4.93%.
Cboe’s Mandy Xu told MarketWatch that the oil-yield correlation is near a 35-year high, making Iran developments increasingly important for bonds.
3. Meta’s Muse remains the test for the AI trade
Muse has become more than a one-day catalyst. The assistant has topped Apple’s US App Store, while Meta and Shopify are working together to let users complete purchases through Muse.
Truist analyst estimates Muse could add $28.5 billion in revenue by 2030.
That helps explain why investors are treating consumer AI adoption as an earnings story rather than only a usage story.
4. AutoZone earnings put the consumer trade under scrutiny
AutoZone reports fiscal fourth-quarter results before the bell, with Wall Street looking for roughly $6.7 billion in revenue and earnings of about $54 a share.
The stock is down roughly 31% over the past year. Oppenheimer recently cut its price target to $3,500 from $4,300 while maintaining an Outperform rating, according to Investing.com.
Investors will focus on same-store sales, commercial growth, margins and whether spending on stores and Mega Hubs is translating into stronger earnings.
5. ADP jobs data and Fed speakers could reset October odds
ADP’s weekly private-employment estimate is due at 8:15 am ET, followed by New York Fed President John Williams at 10:05 am.
For investors following the reaction through trading apps, the key signal will be whether stronger labour data pushes Treasury yields higher and strengthens expectations for another rate increase.
Fed Vice Chair Philip Jefferson and Richmond Fed President Thomas Barkin are also scheduled to speak later.
Markets currently put the chance of at least another 25-basis-point hike in October at 57.6%. Firm labour demand could reinforce expectations that the Fed is not finished tightening.
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