US stock futures fell sharply on Tuesday, with technology shares facing the prospect of further losses as selling intensified across artificial intelligence and semiconductor stocks.
The technology sector remained under pressure after steep declines in Alphabet and SpaceX weighed on Wall Street during Monday’s session.
US Stock Futures Point to a Weaker Open
S&P 500 futures declined by 1% to 7,462.75 points during early trading.
Nasdaq 100 futures dropped nearly 2% to 30,062.50 points, reflecting heavier pressure on technology stocks. Dow Jones futures recorded a smaller decline of 0.3% to 51,945 points.
The difference between the major indexes suggested that investors were primarily reducing exposure to AI, semiconductor and other high-growth technology shares.
AI and Semiconductor Stocks Face More Selling
The sharp decline in Nasdaq futures indicated that the technology sector could suffer another difficult trading session.
Chipmakers appeared particularly vulnerable after a severe selloff across Asian markets.
South Korea’s KOSPI index fell more than 8% as investors sold major semiconductor stocks. Samsung Electronics declined around 8%, while SK Hynix dropped approximately 11%.
Both companies had previously led the strong rally in Asian semiconductor stocks during 2026.
Profit-Taking Hits the AI Stock Rally
The latest weakness followed a wave of profit-taking after artificial intelligence and semiconductor stocks recorded substantial gains earlier in the year.
Investors also became more cautious about elevated valuations following the rapid rise in AI-related shares.
Concerns about higher US interest rates added further pressure after the Federal Reserve delivered a more hawkish message during its latest policy meeting.
Higher interest rates can reduce the appeal of technology companies whose valuations depend heavily on expectations of future growth.
Markets Await Key US Economic Data
Several important US economic reports are scheduled for release this week and could influence the Federal Reserve’s interest-rate outlook.
Purchasing Managers’ Index data for June is due on Tuesday.
Revised first-quarter gross domestic product figures and the May Personal Consumption Expenditures Price Index are scheduled for Wednesday.
The PCE Price Index will receive particular attention because it is the Federal Reserve’s preferred measure of inflation.
Investors have become increasingly convinced that the central bank could leave interest rates unchanged or potentially raise them later this year.
FedEx Earnings Also in Focus
Corporate earnings will provide another potential market catalyst during the week.
Logistics company FedEx is scheduled to publish its quarterly results, offering investors further insight into business activity, consumer demand and global trade conditions.
The company’s outlook could also provide clues about the health of the broader US economy.
Wall Street Ends Monday Mixed
US stocks delivered a mixed performance on Monday following the extended weekend.
The S&P 500 declined almost 0.4%, while the Dow Jones Industrial Average gained 0.3%.
The technology-heavy Nasdaq Composite underperformed, falling approximately 1.3%.
Losses in Alphabet and SpaceX were among the main factors weighing on the Nasdaq.
Alphabet Falls After AI Executive Departures
Alphabet shares declined nearly 5% after two prominent artificial intelligence executives reportedly left the company within several days.
The departures raised concerns about competition for AI talent as major technology companies increase spending and race to develop more advanced models.
Investors are closely monitoring whether the changes could affect Alphabet’s artificial intelligence strategy and its ability to compete with other industry leaders.
SpaceX Shares Reverse Post-IPO Gains
SpaceX shares fell around 16%, reversing part of the strong rally that followed the company’s initial public offering and market debut earlier in June.
The Elon Musk-led aerospace company came under pressure after KeyBanc analysts adopted a more cautious position on the stock.
The brokerage highlighted concerns about SpaceX’s valuation and said it needed greater clarity regarding progress on the next-generation Starship rocket.
Analysts also sought more information about the company’s wider commercial development plans.
US-Iran Peace Negotiations Show Progress
Geopolitical developments remained another important focus for financial markets.
US and Iranian officials offered encouraging comments following peace negotiations held in Switzerland on Sunday. However, President Donald Trump continued to warn Tehran about the possibility of further military action.
Statements from Pakistani and Qatari mediators indicated that the United States and Iran had agreed to hold additional technical discussions in the coming days.
Peace Talks Ease Pressure on Energy Markets
Progress in the negotiations provided some relief to investors.
Oil prices fell sharply and moved closer to the levels recorded before the conflict. Shipping flows through the Strait of Hormuz also appeared to improve.
The United States and Iran reportedly agreed to a 14-point memorandum of understanding aimed at ending hostilities.
The framework includes a 60-day negotiation period intended to produce a more comprehensive peace agreement.
