After the worst week for the Nasdaq since June, the AI trade is catching a bid before the bell — and it is the chip names leading it back up. Europe is going the other way.
Overnight Developments
Investors buy the dip in the AI trade — CNBC
Last week was ugly: the S&P 500 lost nearly 2%, its biggest weekly decline since late June, and the Nasdaq tumbled 4.5%. Friday alone took the Nasdaq Composite down 2.15% while the Dow gave up just 0.34% — a selloff aimed squarely at AI infrastructure, not at the market as a whole. The proximate worry was financing cost, not demand: CoreWeave ended the week 25.21% lower on debt concerns, and the chip complex had been red for eight straight sessions.
This morning that trade is being bought back. Intel is up more than 4% after JPMorgan upgraded it to neutral from underweight, CoreWeave is up 3%, and AMD and Micron are each up more than 2%.
Affected sectors: Tech, Semiconductors, AI Infrastructure
French unrest compounds debt crisis fears — CNBC
Weekend protests turned violent — roughly 550,000 marchers, nearly 2,400 arrests, close to 1,000 police injured. The CAC 40 is off about 1.3%, the French 10-year yield is up more than 10bp, and the OAT–Bund spread has widened to its worst since the early-2010s debt crisis. The National Assembly votes Tuesday on the Lecornu government’s €54 billion budget savings plan. This is the clearest explanation for why Europe is red while US futures are green.
Affected sectors: European Banks, Luxury, Rates, FX
China Q3 growth beats — CNBC
Third-quarter GDP came in at 4.5%, ahead of the 4.4% consensus and up from Q2’s three-year low of 4.3%, as exports surged to a record monthly trade surplus of $133.5 billion. Enough to steady Asia, not enough to lift Europe.
Affected sectors: Industrials, Materials, EM
Futures & Pre-Market
| Index | Futures | Change |
|---|---|---|
| S&P 500 | 7,751.25 | +0.61% |
| NASDAQ | 29,762.50 | +1.26% |
| DOW | 52,234.00 | +0.04% |
Measured against Friday’s 16:00 ET settle, as of ~06:55 ET. The spread between the Nasdaq and the Dow is the whole story this morning — this is a sector rebound, not a broad risk-on move.
Treasury yields are easing slightly: the 10-year sits at 5.085% and the 30-year at 5.424%, each about a basis point lower, with the 2-year flat at 4.732%. As JPMorgan strategist Mislav Matejka put it, “If bond yields are stabilizing, that will help equities, through allowing the cycle to look more sustainable, through reducing pressure on AI funding.”
Watchlist Movers
- INTC +4.1% — JPMorgan upgrade to neutral from underweight
- SMCI +3.5% — AI server names rebounding with the chip complex
- SMR +3.0% — nuclear/power-for-AI basket bid alongside tech
- TSM +2.1% and NVDA +1.6% — semis recovering after eight down sessions
- OKLO +2.6%, CRCL +2.4%, RKLB +1.8%, TEM +1.4%, MSTR +1.2%, AMZN +1.1%
Two caveats worth carrying into the open. NNE screens at +4.1%, but that rests on a single print at 05:15 ET with nothing since — treat it as stale rather than a real move. UPS has no pre-market prints at all, which means unknown, not unchanged.
International Markets
Europe is clearly weak: DAX -1.08%, FTSE 100 -0.92%, with France leading the decline. Asia was mixed — Nikkei -0.62% as PM Takaichi pushed back on criticism of the weak yen, Shanghai +0.39% on the GDP beat, Kospi +1.76% and ASX +0.44%. Hong Kong was closed for the day following the Chung Yeung Festival.
Crude eased but by less than the screens suggest: WTI is near $97.97 and Brent near $108.22. Front-month WTI appears to have dropped 3.4% overnight, but that is the December contract replacing November — on a like-for-like basis the move is closer to -1.1%. Brent’s -1.5% is clean.
What to Watch at Open
The tape is asking one question: is this a real bottom in the AI trade or an oversold bounce? Watch whether Intel’s upgrade-driven pop broadens into the rest of the chip complex or fades by mid-morning — and watch the 10-year, because this selloff was about financing costs, and stabilizing yields are what the rebound is leaning on. BTIG is already telling clients to sell into any semiconductor strength.
This alert is for informational purposes only and does not constitute financial advice.