U.S. stocks were on track for a modest recovery on Tuesday after a steep slide in the previous session amid market jitters over President Donald Trump’s shifting tariff policies and escalating concerns about AI disruption.
Leading the gains was Advanced Micro Devices, which jumped almost 10% in premarket trading after the chipmaker said it had agreed to sell up to $60 billion worth of AI chips to Meta Platforms over five years.
Home Depot gained 2.5% after the home-improvement chain operator topped estimates for fourth-quarter results and maintained its annual forecasts.
All three main indexes fell more than 1% on Monday, with financials and software stocks among the worst hit as the fallout from Friday’s U.S. Supreme Court ruling on Trump’s tariffs caused an exodus from high-risk equities.
After Friday’s ruling, Trump announced a temporary global tariff of 10%, which came into effect on Tuesday. He later said the levy would be 15%, but it was unclear when and if this would apply.
READ MORE: Wall St on pace for lower open as tariff uncertainty curbs risk appetite
“The market doesn’t only have one particular worry… the AI trade has certainly become a worry for the market but then there are geopolitical concerns, macro concerns and of course, the tariff concerns,” said Peter Cardillo, chief market economist at Spartan Capital Securities.
Analysts also attributed Monday’s selloff to a bearish report from Citrini Research outlining potential threats to the global economy from the rise of AI.
At 08:29 a.m. ET, Dow E-minis added 86 points, or 0.18%, S&P 500 E-minis were up 5.5 points, or 0.08%, and Nasdaq 100 E-minis rose 93.75 points, or 0.38%.
Megacap and growth stocks were mixed, with Nvidia down 0.7% ahead of its earnings, which are expected after markets close on Wednesday.
Alphabet and Apple rose marginally.
Keysight Technologies climbed 14.5% after the electronic equipment maker forecast second-quarter profit ahead of Wall Street estimates.
Hims & Hers Health fell 4.9% after the online telehealth company forecast first-quarter revenue below estimates.
Major software players Salesforce and Intuit are also scheduled to report later this week, with their results likely to draw heightened scrutiny as the sector grapples with mounting AI-disruption fears.
The S&P 500 software and services index, down almost 24% so far this year, saw no respite and fell 4.3% on Monday, becoming one of the day’s worst-performing sectors.
February has been a dour month for U.S. shares as high stock valuations and artificial intelligence concerns pressure technology and other sectors, with investors questioning if massive AI spending was actually paying off.
Trump will deliver the traditional State of the Union address to Congress later on Tuesday. At least six Federal Reserve officials are also slated to speak through the day, and investors will look for hints on the policy trajectory.
Traders currently expect the U.S. Federal Reserve to hold interest rates steady at its March meeting, with the next rate cut not anticipated until June, according to the CME FedWatch Tool.
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