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S&P 500 futures rose on Tuesday as investors moved back into key technology stocks after recent pressure, while oil fell ahead of the U.S. midterm elections.
Futures tied to the broad market index rose 0.2%, while Nasdaq-100 futures jumped 0.8%. Dow Jones Industrial Average futures, however, traded down 127 points, or 0.2%, weighed down by Apple shares.
Apple fell 4% after the consumer tech giant rolled out a disappointing margin forecast and iPad sales in the fiscal fourth quarter missed the Street's estimates.
Conversely, shares of chipmakers bolstered S&P 500 and Nasdaq-100 futures. Micron Technology jumped almost 4%, while Advanced Micro Devices and Intel each rose more than 3%. Additionally, Broadcom and Nvidia gained around 2%.
Oil prices, meanwhile, turned lower on speculation that there was progress in Iran-U.S. negotiations. Brent crude was down almost 3% at around $101 per barrel. West Texas Intermediate futures dropped nearly 2% to around $94 per barrel.
Stocks are coming off a mixed session. The tech-heavy Nasdaq Composite dipped 1.07%, while the S&P 500 fell 0.51% as investors continued their rotation out of tech stocks. The Dow rose about 214 points, or 0.41%.
Investors are turning their attention toward the midterm elections on Tuesday, where prediction market traders see a nearly 75% likelihood of Democrats taking the Senate.
A sweep of the House and Senate by Democrats could weigh on the broader market on Wednesday — and spark a sell-off in artificial intelligence stocks especially — as investors have not firmly positioned for that outcome. If Republicans retain control of the Senate or both chambers, however, the market may see gains in the short term.
Even with President Donald Trump in the White House, a victory by Democrats in either the House or Senate could shape investigations and oversight in Washington — which is key for industries like defense, AI and healthcare.
Once the elections are over, markets may find some calm, according to Ryan Detrick, CNBC contributor and chief market strategist at Carson Group. "There's some anxiousness before these elections," he told CNBC. "Once you are through it, it's a big relief and markets tend to do pretty well."
Over in Asia, markets were mostly down on Tuesday, led by tech losses in South Korea and Taiwan. The Kospi ended 3.59% down at 5,648.79, while the Taiwan Weighted Index fell 3.59% as well, closing at 43,307.54. Mainland China's CSI 300 closed 0.2% down at 4,008.87. The only exception was Australia's S&P/ASX 200, which gained 0.34% to end at 8,886.8, as well as Hong Kong's Hang Seng Index, which was 0.37% up in its final hour of trade.
Correction: A prior version of this story had an incorrect forecast for Apple's first-quarter guidance.
Shares of Lumentum sunk more than 18.5% on Monday after Marvell Technology announced a deal to acquire the company for $115 billion. But Raymond James thinks that sell-off is overdone.
The firm upgraded Lumentum to strong buy from outperform, and raised its price target to $1328. That implies a 94% gain from Monday's close. While some investors are skeptical about why Lumentum would sell itself now, analyst Simon Leopold outlined the reasoning in a Monday note.
"Lumentum's explanation is that the combined entity massively increases the TAM and provides RemainCo with the tech/tools needed to enable more design wins, differentiated products, and higher margins, which benefits shareholders willing to bet on the strategic vision," he wrote in the note. "Part of the assertion is that co-engineering improves the time-to-market, and we agree. A.I. hardware is evolving at breakneck speed, and winning long-term requires extreme co-design, as interconnect enables the next generation of scale compute."
Lumentum was rebounding in premarket trading Tuesday, up 2%.
Check out the companies making the biggest moves premarket:
Shares of Yum Brands were down by 0.5% despite reporting stronger-than-expected third-quarter earnings.
The restaurant chain operator delivered adjusted earnings of $1.56 per share, compared to analysts polled by LSEG's estimates for $1.49 per share. Revenue came in-line with estimates at $2.05 billion.
Yum's same-store sales growth was weighed down by Taco Bell, which was impacted by a cyclospora outbreak linked to iceberg lettuce. But the company said Taco Bell had since rebounded.
Treasury yields edged higher Tuesday as voting began in the U.S. midterm elections, while investors parse a busy week of economic data and renewed Middle East tensions that pushed oil prices higher.
Yields on 10-year U.S. Treasurys — the main benchmark for mortgages, auto loans and credit card debt — rose more than 1 basis point to 4.9105%.
The yield on longer-dated 30-year U.S. Treasurys — which tends to move more on geopolitical developments — was up 1 basis point at 5.2815%.
The yield on the 2-year Treasury note, which more closely follows short-term Federal Reserve rate decisions, was holding steady at 4.5915%.
Shares of Bayer jumped as much as 5.6% after the pharmaceutical and chemicals company posted quarterly results ahead of expectations and raised its full-year guidance.
Driven by its pharma business performance, Bayer said it now sees adjusted core earnings of between 9.8 billion euros and 10.3 billion euros (between $11 billion and $11.5 billion) on a currency-adjusted basis, up from a previously expected range of 9.6 billion euros and 10.1 billion euros.
"We've reached a turning point in Pharma's growth trajectory and we're beginning to see the other side," said CEO Bill Anderson in a statement. Sales of its prostate cancer drug Nubeqa and kidney medicine Kerendia topped expectations in the quarter.
In the third quarter, group sales amounted to 10.1 billion euros, up 1.9% on an adjusted basis. Core earnings rose 6.9% to 1.6 billion euros, 13.5% ahead of FactSet expectations, as the pharmaceutical business more than offset weakness in its crop science and consumer health businesses.
Bayer shares are up around 42% this year as the German conglomerate works to resolve U.S. litigation over its Roundup weedkiller, inherited through its 2018 Monsanto acquisition. Bayer denies claims that the product causes cancer and has paid more than $11 billion in legal costs.
Switzerland's annual inflation rate reached a hotter-than-expected 1.5% in October, up from 1% the previous month. The rise was largely due to the rising cost of heating oil, petrol and diesel.
Economists polled by Reuters had been expecting Swiss inflation to rise to 1.3% on an annual basis.
Switzerland's central bank has a target range for inflation of 0% to 2%.
The safe haven Swiss franc was 0.2% higher against the U.S. dollar on Tuesday morning.
Brookfield is targeting a massive artificial intelligence data center in the north of England, as Europe scrambles to develop infrastructure to support the rollout of AI amid high energy and land costs.
Energy company Drax Group said Tuesday it has signed an agreement with Brookfield and the asset manager's neocloud platform Radiant to jointly develop an AI data center on the Drax Power Station estate in North Yorkshire. London-listed shares of Drax were up 8.2% in early morning trading.
European semiconductor stocks fell in early trading amid a global technology sell-off. ASML fell by 3.4%, ASMI by 2.1%, STMicroelectronics by 3.9% and Infineon Tech by 3.9%.
"I don't think this is a concern about current earnings because current earnings are strong. It's not a concern around the current cycle because we've just seen the [U.S. ISM figures] yesterday... the cycle is still doing well," Willem Sels, HSBC's chief investment officer, told CNBC's "Squawk Box Europe" on Tuesday.
"It's a wild ride. It's a concentrated ride as well, so whenever there is news around the AI cycle, people can take important decisions."
"But it is mostly that mismatch between current spending and future revenues, you know, coming from the data centers. Now that's obviously quite characteristic for any new technology, and that's a fact of life. I do think that from a credit perspective, we're not seeing a broad-based sell-off at this point."
"Ultimately, the demand for AI will continue to pick up exponentially in our view," he added.
European stock markets opened broadly lower on Tuesday, with the regional Stoxx 600 index down 0.62% at the open.
Concerns over the financial health of technology firms continued to weigh, with the sector down 2.1%, while mining stocks fell 2.2%.
Food and beverage and healthcare stocks were the lone bright spots, both up around 0.3%.
Asia markets were mostly down on Tuesday, led by tech losses in South Korea and Taiwan.
The Kospi ended 3.59% down at 5,648.79, while the small cap Kosdaq saw a larger loss of 4.08% to close at 704.39. The Taiwan Weighted Index also fell 3.59%, closing at 43,307.54.
Mainland China's CSI 300 closed 0.2% down at 4,008.87.
The only exception was Australia's S&P/ASX 200, which gained 0.34% to end at 8,886.8, as well as Hong Kong's Hang Seng Index, which was 0.37% up in its final hour of trade.
German car parts and machinery maker Schaeffler said Tuesday it would cut 3,460 jobs and close five of its sites across Europe, in the latest sign of strife in the European autos sector.
Approximately 2,660 jobs and four of the sites likely to be cut are in Germany. The company's performance improvement program is looking to eliminate overcapacity as it grapples with weaker demand for combustion engine vehicles and slower-than-expected pick-up of EVs.
"Added to this are the above-average costs per employee in Germany and the high complexity of the organization, with too many management levels and overly limited delegation of leadership responsibilities," it said in a statement.
Schaeffler said it expected to incur one-off costs of 480 million euros ($537.2 million) and around a 400 million euros annual boost to earnings from 2030.
Schaeffler also on Tuesday reported a 0.2% year-on-year fall in revenue to 5.8 billion euros in the third quarter, and a 7.2% fall in earnings before interest and taxes before special items to 245 million euros.
Germany's Volkswagen is currently engaged in a massive strategic overhaul expected to result in around 100,000 job cuts.
Australia's central bank raised its benchmark cash rate by 25 basis points to 4.85% on Tuesday, the highest level since November 2008.
The Reserve Bank of Australia's move was in line with expectations from economists polled by Reuters, and marked its fifth rate increase this year.
This also comes as the country continues to grapple with high inflation, with the consumer price index rising 4.3% in September, up from 4% in August and marking its highest level since March.
The central bank also said inflation is now expected to "remain elevated through much of 2027," and not expected to fall back into its 2%-3% target range till late 2027, three quarters later than previously forecast.
North Korea rejected U.S. allegations linking Pyongyang to the estimated $6.3 billion Binance hack, calling the accusation a "grave political provocation," according to state media.
Kim Yo Jong, sister of North Korean leader Kim Jong Un, denounced the FBI's attribution of the attack to North Korea-linked hacking group TraderTraitor, Yohnap reported Tuesday, citing the state-run Korean Central News Agency.
She accused Washington of misleading international public opinion by portraying cybercrimes around the world as the work of North Korea.
Hong Kong's Hang Seng Index rose 0.16% in early trade in Asia, with gains in the academic and education sector offsetting losses from the energy sector.
Mainland China, on the other hand, saw the CSI 300 index slip 0.84%, also weighed down by tech and energy stocks.
Asia-Pacific markets were mixed early Tuesday, with South Korea's Kospi sliding sharply as it tracked Wall Street's losses in the tech sector.
The Kospi dropped 3.55% at open, with heavyweight Samsung Electronics down by 5%, while the small-cap Kosdaq slipped 2.53%.
Australia's benchmark S&P/ASX 200 was 0.21% higher.
Several stocks made sharp moves in after-hours trading following the latest round of earnings releases.
Apple — Apple shares were down 2% in extended trading after the consumer tech giant rolled out a disappointing margin forecast and iPad sales in the fiscal fourth quarter missed the Street's estimates.
The Clorox Company — The maker of Clorox Disinfecting Wipes added 2% after fiscal first-quarter results came in ahead of estimates. The company earned $1.55 per share on an adjusted basis on revenue of $1.91 billion. Analysts surveyed by LSEG were looking for $1.07 a share and $1.88 billion. Organic sales growth for the period also topped estimates.
Palantir Technologies — Palantir shares were down 2% even after the company's third-quarter earnings topped Wall Street's estimates. Revenue for the period nearly doubled from a year earlier and surpassed $2 billion for the first time. The company's U.S. commercial revenue jumped 148% to $984 million, topping U.S. government revenue of $953 million. Palantir is also projecting about $2.65 billion in fourth-quarter revenue and $8.53 billion for full-year 2026.
Correction: A prior version of this blog post had an incorrect forecast for Apple's first-quarter guidance.
Asia-Pacific markets were set to open higher Tuesday, breaking ranks with the tech induced slide on Wall Street as investors also looked toward the U.S. midterm elections.
Australia's S&P/ASX 200 started the day 0.57% higher as traders awaited the Reserve Bank of Australia's rate decision later on Tuesday.
Hong Kong Hang Seng index futures were at 23,535, compared with the index's last close of 23,393.
Japan's markets are closed for a public holiday.
Nasdaq-100 futures were little changed after 6 p.m. in New York.
Dow Jones Industrial Average futures lost 0.02%. S&P 500 futures fell 0.02%. Nasdaq-100 futures added 0.09%.