What moved
- US futures are the only live read on Wall Street. S&P 500 futures are 0.13% lower and Nasdaq 100 futures 0.38% lower. On Monday the S&P 500 closed up 0.41% at 7,690.73 and the Nasdaq Composite rose 1.11% to 26,430.89. The Dow finished 0.07% lower at 51,966.03.
- Europe is extending Monday's losses at mid-session. The Euro Stoxx 50 is down 1.03%, the CAC 40 0.95%, the DAX 0.87% and the FTSE 100 0.73% at 10,686.16.
- Asia closed firmly lower. The Kospi ended down 3.73% at 5,552.74, the Hang Seng fell 1.32%, the Nikkei 225 1.30% and Taiwan 1.13%. Shanghai edged up 0.12%.
Why
Two forces are pulling against each other this morning. The first is a fresh scare over how spending on artificial intelligence is being financed. It started in Seoul. There, profit-taking in chipmakers and worries about the credit risk and profitability of AI investment drove the Kospi's slide, and Samsung Electronics and SK hynix both fell sharply. In Tokyo, SoftBank dropped hard as the cost of insuring its debt against default rose, on its AI funding needs and talk of a large acquisition. That is why Nasdaq futures are lagging after Monday's chip-led rebound, and that rebound was narrow to begin with.
The second force works the other way: weak US data. Housing starts fell well short of forecasts, and Treasuries rallied. The 10-year yield is down 4.2bp at 5.094% and the 30-year is down 5.4bp. Lower long-term yields support growth stocks, because the profits investors expect years ahead are worth more today when rates are lower. That helps explain why futures are only modestly in the red.
Europe has its own problem. Unrest in France over living costs has widened the gap between French and German borrowing costs, and banks led Monday's losses. Brent crude is holding at $109.80. Houthi strikes on Saudi Arabia and attacks on tankers near the Strait of Hormuz keep a supply-risk premium in the price.
Sentiment & risk appetite
Risk appetite looks fragile but not broken. The VIX is at 18.87, up 0.43 points. The MOVE index, which tracks bond-market volatility, closed Monday at 101.30. Monday's US gains were narrow. Across PrimerIQ's own US universe, decliners outnumbered advancers 3,506 to 2,543 even as the S&P rose. Consumer discretionary (+1.78%) and technology (+1.36%) carried the day, while utilities (−2.01%) and real estate (−1.16%) fell. That points to money chasing a handful of large growth names rather than the whole market. Safe havens show no alarm: gold is down 0.37% at $4,144.50 and the dollar index is 0.25% lower at 101.72.
Economic calendar
The 08:30 ET release was a clear miss. September housing starts fell 5.2% to an annualised 1.221 million, against expectations near 1.30 million, and single-family starts were down 4.6%. Building permits held at about 1.40 million, roughly in line with forecasts, so the pipeline has not collapsed. But builders are starting fewer homes, with the 30-year mortgage rate averaging 7.40% last week. The Fed is in its quiet period before its 28 October decision, and this adds to the evidence that high rates are weighing on activity.
The Atlanta Fed's GDPNow estimate updates at 10:00 ET. Tomorrow brings a 20-year Treasury auction at 13:00 ET.
Earnings
Industrial bellwethers beat forecasts across the board, but the share reaction depends on guidance. RTX earned $2.26 a share against $1.78 expected and raised its full-year outlook, and its shares are higher pre-market. Northrop Grumman and 3M also beat and raised guidance. GE Aerospace beat ($2.25 against $2.02) and raised its 2026 targets, yet its shares are slipping, a sign of how much good news was already priced in. General Motors also beat but is down sharply after narrowing its profit range and trimming the top end.