Nasdaq 100 and S&P500: US Stocks Slip as Tesla, IBM Earnings Hit Market Forecasts

Stocks Slide Pre-Market as Tesla, IBM Disappoint; Trump Trade Moves Spark Sector Volatility

U.S. stock futures declined early Thursday, extending losses from the previous session as disappointing earnings from Tesla and IBM weighed on investor sentiment.

Futures tied to the Dow Jones Industrial Average slipped 0.2%, while S&P 500 and Nasdaq 100 futures lost 0.2% and 0.3%, respectively. The pullback comes after the S&P 500 dropped 0.5% and the Nasdaq fell 0.9% on Wednesday, with traders retreating from growth stocks as geopolitical tensions and earnings jitters escalated.

How Are Earnings Pressuring Major Indexes?

Tesla shares dropped nearly 4% after mixed third-quarter results that failed to meet profit expectations despite a rise in revenue and a surge in capital spending.

IBM tumbled 7% premarket after reporting in-line software revenue, despite beating overall earnings estimates. The weak performance from both companies added pressure to the tech-heavy Nasdaq and raised concerns about the sustainability of recent gains in mega-cap stocks.

Despite more than 75% of S&P 500 companies reporting earnings above estimates, the broader market remains on edge. Strategists, including MAI Capital’s Chris Grisanti, are advising traders to shift from overbought names into undervalued sectors like healthcare, citing stretched valuations reminiscent of the late 1990s bubble.

Which Sectors Are Seeing Action from Trump’s Trade Moves?

Energy and defense-linked names are in focus after the Trump administration announced new sanctions on Russia’s Rosneft and Lukoil, citing failures to advance a Ukraine ceasefire.

Oil prices surged over 5%, with Brent rising to $65.96 and U.S. crude jumping to $61.76. The move follows broader White House efforts to pressure countries like India to curb Russian oil imports and could weigh on global supply sentiment.

Is Washington Accelerating Its Bet on Quantum Tech?

Quantum computing stocks surged following reports that the U.S. Commerce Department is considering taking equity stakes in firms like IonQ and Rigetti in exchange for federal funding. Shares of IonQ and D-Wave rose 9%, while Rigetti advanced 7% in premarket trading. The development has intensified expectations that Washington is expanding its involvement in high-priority tech sectors tied to national security.

What Other Stocks Are on the Move?

American Airlines rose 3.5% after its fourth-quarter earnings forecast topped expectations, lifting full-year guidance well above Street consensus. Meanwhile, Molina Healthcare plunged 18% after cutting its annual profit outlook due to rising costs. Hasbro and Tractor Supply slipped 3% each on mixed results. Beyond Meat fell 19% as enthusiasm over its meme stock status waned, while IBM and Tesla led tech declines.

What Should Traders Watch Next?

Markets will remain focused on megacap earnings and developments from Washington. Trump’s pending meetings with global leaders, particularly Xi Jinping and possibly Putin, could shift trade expectations.

Traders are also eyeing oil prices for inflation implications, as well as further signals from the Treasury on federal intervention in critical industries. With valuations under scrutiny and geopolitical risks rising, short-term sentiment remains cautious, leaning bearish into Thursday’s session.

More Information in our Economic Calendar.