Dow Futures Edge Lower As Investors Remain Cautious On AI Valuation Concerns: AMD, ANET, SMCI, HOOD Among Stocks To Watch

While Dow Jones futures edged lower by 0.07% at the time of writing, the S&P 500 futures fell 0.36%.

• Anthony Saglimbene of Ameriprise stated that valuations are beginning to look “really stretched” without a pullback, in an interview with CNBC.
• Earlier, the CEOs of Goldman Sachs and Morgan Stanley warned of the possibility of a 10% to 20% drawdown in equities.
• Asian markets ended Wednesday’s trading session on a largely negative note, with the Nikkei 225 declining the most at 3.17%.

U.S. stocks appear set for a negative opening on Wednesday as investors exercise caution amid growing concerns over AI valuations.

In an interview with CNBC, Anthony Saglimbene of Ameriprise stated that valuations are beginning to look “really stretched” without a pullback. “We haven’t really seen any major corrections or any real pressure on stocks since April,” he said in the interview, noting that investors are beginning to question if the capital expenditure incurred by tech giants is justified based on the profits they are generating.

On the other hand, Palantir Technologies Inc. (PLTR) co-founder and CEO Alex Karp called out Michael Burry on Tuesday for his short bets against the Colorado-based company as well as AI bellwether Nvidia Corp. (NVDA).

Futures Trade Lower

While Dow Jones futures edged lower by 0.07% at the time of writing, the S&P 500 futures fell 0.36%, while the tech-heavy Nasdaq 100’s futures declined 0.57%. Futures of the Russell 2000 index fell 0.06%.

Meanwhile, the SPDR S&P 500 ETF (SPY) was down 0.36% at the time of writing. Invesco QQQ Trust (QQQ) fell 0.56% on Wednesday morning, and theSPDR Dow Jones Industrial Average ETF Trust (DIA) declined 0.13%. Retail sentiment around the S&P 500 ETF on Stocktwits was in the ‘extremely bearish’ territory.

Asian Markets Decline

Asian markets ended Wednesday’s trading session on a largely negative note, with the Nikkei 225 declining the most at 3.17%, followed by the KOSPI at 2.93%, the TWSE Capitalization Weighted Stock index at 1.44%, and the Hang Seng at 0.31%.

The Shanghai Composite index gained 0.23%.

Stocks To Watch

• Advanced Micro Devices Inc. (AMD): AMD’s third-quarter (Q3) results beat Wall Street expectations, with the company reported earnings per share (EPS) of $1.2 on revenue of $9.25 billion, beating analyst estimates of an EPS of $1.17 on revenue of $8.76 billion, according to Stocktwits data. However, AMD’s shares were down nearly 5% in Wednesday’s pre-market trade.
• Arista Networks Inc. (ANET): Arista Networks shares declined more than 12% pre-market even as the company’s fourth-quarter (Q4) guidance came in line with expectations. Arista forecast Q4 revenue in the range of $2.3 billion to $2.4 billion – at a midpoint of $2.35 billion, it edged past analyst estimates of $2.34 billion, according to Stocktwits data.
• Super Micro Computer Inc. (SMCI): Super Micro shares fell 9% pre-market as the company’s first-quarter (Q1) results missed Wall Street expectations. Super Micro reported EPS of $0.35 on revenue of $5.02 billion, missing analyst estimates of $0.37 EPS on revenue of $5.83 billion, according to Stocktwits data.
• Robinhood Markets Inc. (HOOD), DoorDash Inc. (DASH), and Qualcomm Inc. (QCOM) are among the companies scheduled to report their latest quarterly earnings on Wednesday.

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