Wall St set to open lower as caution builds ahead of Big Tech earnings

The heavy earnings slate sets markets up for a potentially choppy week, with geopolitical risks adding to the caution. Fighting in the Middle East remained in focus as threats to shipping by Yemen's Iran-backed Houthi militia, alongside a widening conflict, disrupted two of the world's most important energy chokepoints. U.S. Secretary of State Marco Rubio said Washington was still willing to negotiate an end to the Iran crisis, but that Tehran was "not serious" about talks. Oil prices climbed to near six-week highs, complicating the outlook for central bankers. The Federal Reserve is expected to keep interest rates steady for the rest of 2026, according to the median forecast in a Reuters poll of economists, though respondents said the risk of a rate hike remained elevated. Traders are pricing in more than a 70% chance the Fed leaves rates unchanged at next week's meeting, CME Group's FedWatch tool showed. By 8:42 a.m. ET, S&P 500 E-minis EScv1 were down 23.25 points, or 0.31%. Nasdaq 100 E-minis NQcv1 fell 251.25 points, or 0.87%, and Dow E-minis YMcv1 dropped 59 points, or 0.11%. Among premarket movers, AT&T T.N rose 4.8% after the telecom firm added more wireless subscribers than expected in the second quarter. Super Micro Computer SMCI.O surged 12.3%, as the AI server maker said it had secured more than $60 billion in new fourth-quarter orders and now expects gross margin to exceed its previous gross-margin forecast. U.S. stocks were on track to open lower on Wednesday, pressured by weakness in chip stocks, as investors remained cautious ahead of the first batch of Big Tech earnings that could decide whether Wall Street's AI-driven rally has more room to run. After months of gains that pulled the major indexes up from their March lows, momentum has faltered as volatility in heavyweight semiconductor shares has dented risk appetite. Investors are now looking to second-quarter results from Alphabet GOOGL.O and Tesla TSLA.O, the first of the so-called "Magnificent Seven" megacap companies to report after the bell for fresh evidence that these companies' multibillion-dollar investments in AI are paying off. Alphabet will be under particular scrutiny after a delay in the launch of a model central to its AI ambitions intensified concerns. Its shares edged 0.3% higher in premarket trading. "Investors are going to take sort of a wait-and-see attitude before deciding whether the trend is decidedly down or whether yesterday's 'buy the dip' has some sustainability," said Sam Stovall, chief investment strategist at CFRA Research. "The magnitude of capex spending will be central to both Tesla and Alphabet." Texas Instruments TXN.O, also due to report after the close, slipped 1.6%, tracking broader weakness across semiconductor stocks. iShares semiconductor ETF SOXX.O edged 2.8% lower.

Wall St set to open lower as caution builds ahead of Big Tech earnings

Premarket movers and broader market backdrop

U.S. stocks set to open lower ahead of major earnings

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