S&P 500, Nasdaq futures decline ahead of US return: Markets wrap

Market Overview - US equity-index futures showed a decline, with S&P 500 contracts dropping 0.4% and Nasdaq 100 Index contracts slipping 0.7%, indicating a cautious market sentiment following the Presidents' Day holiday [1] - Asian stocks fell by 0.1% amid thin trading conditions, with several markets closed for the Lunar New Year, while European shares were also expected to open weaker [2] Treasury and Bond Market - The yield on 10-year Treasury bonds decreased by two basis points to 4.03%, while demand for Japanese government bonds increased at a recent auction, signaling stabilization [3][7] Geopolitical Risks - Geopolitical risks have resurfaced, particularly concerning developments in the Middle East, as traders monitor the situation between the US and Iran, which has affected market sentiment [4][5] Federal Reserve and Economic Indicators - Investors are looking for insights into the Federal Reserve's interest rate trajectory, with key speeches and economic data releases scheduled, including ADP private payrolls and minutes from the Fed's January meeting [6] AI Market Impact - The impact of artificial intelligence (AI) has led to selling pressure across various sectors, with the S&P 500 down 0.1% year-to-date and the Nasdaq 100 down approximately 2% [8] - A JPMorgan Chase team has advised caution on stocks vulnerable to AI-driven "cannibalization," particularly in software, business services, and media sectors [8][9] Earnings Resilience - Current earnings season shows a growth rate of 13% for companies, contributing to a positive outlook for the S&P 500 despite the challenges posed by AI disruptions [10]