US markets fell sharply on Monday as renewed pressure in large-cap tech stocks weighed on sentiment. The Dow lost 557 points, or 1.18%. The S&P 500 fell 0.92%, and the Nasdaq dropped 0.84%. Nvidia, Apple and Salesforce led declines, with investors hesitant to add risk ahead of a pivotal week that includes Nvidia’s earnings and the September jobs report.
Private credit lender Blue Owl Capital slid nearly 6% on concerns about its heavy exposure to AI-related datacentre lending, underscoring the market’s growing anxiety over stretched valuations in parts of the AI ecosystem.
Nvidia’s Results Set to Determine the Next Move for Tech
Nvidia will report third-quarter results after Wednesday’s closing bell, an announcement that has become critical for the broader market. The stock fell almost 2% on Monday as traders positioned cautiously ahead of the release.
Baird strategist Ross Mayfield said the market needs confirmation that AI compute demand remains robust, but added that a deeper issue is now emerging: the return on investment for companies buying large quantities of chips. He warned that even modestly muted guidance could trigger a sharp reaction.
Walmart reports Thursday and will offer a clearer picture of whether US consumers are becoming more stretched heading into the holiday season.
Markets Brace for Payrolls Data and Fed Signals in a “Data Vacuum”
Thursday’s September non-farm payrolls report will be the first significant dataset released since the end of the US government shutdown. Strategists say markets have been operating with limited visibility and will welcome any clarity.
The Fed’s October meeting minutes are also due this week, though they may be somewhat stale. Rate-cut expectations for December have fallen sharply: traders now see only a 45% chance of a cut, down from more than 90% a month ago.
Vice Chair Philip Jefferson reiterated a meeting-by-meeting approach, saying inflation risks have eased while labour-market risks have risen.
Alphabet Surges; Bitcoin Drops as Risk Appetite Weakens
Alphabet was the standout performer, jumping 3.1% after Berkshire Hathaway revealed a new stake. Investors viewed the move as a sign that value remains in mega-cap AI names despite their strong run this year.
Bitcoin slid more than 2%, falling below US$95,000 as speculative appetite softened.
The S&P 500 is now down more than 2% in November and more than 3% below its record high. The Nasdaq has fallen more than 5% from its peak, and the S&P 500 tech sector is down nearly 7% from its recent high.
ASX Set to Open Lower
Australian shares are poised for a weaker start, with SPI futures down 52 points, or 0.6%, to 8607.
Local earnings are due from ALS, Plenti, TechnologyOne and Webjet, while the Reserve Bank of Australia releases minutes from its latest meeting.
Across the Tasman, the Reserve Bank of New Zealand will publish its latest business expectations survey.
