U.S. index futures slipped on Tuesday morning, notably in the tech sector, following two consecutive days of losses for the S&P 500 and Nasdaq Composite. This downturn is attributed to concerns over AI demand in the memory chip industry and broader economic worries, even as Asian markets saw mixed reactions after President Trump postponed a military strike on Iran. 
U.S. index futures experienced a downturn on Tuesday morning, largely influenced by a recent sell-off in technology stocks. This follows a period where both the S&P 500 and Nasdaq Composite recorded two consecutive days of losses.
Futures tied to the S&P 500 dipped 0.23%, while Nasdaq 100 futures saw a more significant drop of 0.46%. Dow Jones Industrial Average futures also shed 58 points, or 0.12%. On Monday, the broad market S&P 500 slipped 0.07%, and the technology-centric Nasdaq Composite closed 0.51% lower. In contrast, the blue-chip Dow managed to defy the trend, adding 159.95 points, or 0.32%.
The tech sector's struggles were particularly evident in memory chip stocks. Seagate tumbled almost 7% after CEO Dave Mosley expressed concerns at a JPMorgan conference about the company's ability to meet the surge in demand driven by artificial intelligence, noting that building new factories would be too time-consuming. Micron Technology, a peer, fell nearly 6% in sympathy, with other AI-related stocks also experiencing declines.
These recent losses follow a period of robust rallies, with both the S&P 500 and Nasdaq reaching fresh record highs last week, and the Dow briefly touching the 50,000 mark. However, Kevin Gordon, head of macro research and strategy at the Schwab Center for Financial Research, suggested that the market's most significant rally days might be behind it. "From a positioning standpoint and how stretched things have gotten, probably means that you don't see as sharp of the rallies that we were seeing certainly off the throes of the low in March," he commented on CNBC's "Closing Bell: Overtime."
Geopolitical news also impacted investor sentiment. President Donald Trump announced in a Truth Social post on Monday that he was postponing a planned attack on Iran for Tuesday, following requests from leaders of three Middle Eastern regional powers.
Looking ahead, several companies are scheduled to report earnings before Tuesday's opening bell, including Home Depot, Eagle Materials, and Amer Sports. Traders will also be keenly watching April's pending home sales data.
Asia markets broadly higher amid slightly eased oil prices after Trump postpones attack on Iran
Asia-Pacific markets opened broadly higher on Tuesday, as oil prices, while still elevated, eased slightly in response to President Donald Trump's decision to postpone a military strike on Iran.
Investors were also digesting Japan's first-quarter GDP data, which showed the economy grew at an annualized rate of 2.1% in the first three months of the year, exceeding analysts' expectations of 1.7% and the previous quarter's 1.3%. It's important to note these figures do not fully reflect the impact of the Iran conflict, which began in late February.
Japan's Nikkei 225, after early gains, was marginally lower, though the Topix index rose 0.61%. A summit meeting between Japan's Prime Minister Sanae Takaichi and South Korea's President Lee Jae Myung is also on the radar. South Korea's Kospi extended its early losses, falling 3.86%, and the small-cap Kosdaq dropped 3.40%.
Australia's S&P/ASX 200 posted a gain of 0.89%. Mainland China's CSI 300 index traded flat, while Hong Kong's Hang Seng index added 0.26%. Standard Chartered's Hong Kong-listed shares climbed 2.44% after the lender increased its 2028 return target to 15% and announced plans to reduce its corporate functions roles by 15% by 2030.
Technology layoffs could dampen economic growth, Bank of America says
The significant wave of layoffs impacting the information technology sector could have substantial implications for U.S. economic growth, according to a recent Bank of America report. In April, 40% of all layoffs occurred in tech, a trend that poses risks to consumption growth, the bank highlighted.
Savita Subramanian, head of U.S. equity and quantitative strategy at Bank of America, noted that "the engine of consumption growth from the 80s onward - skilled professional services, filled by college grads - is gumming up," adding that "April's layoffs were in Tech; the college grad u-rate is at recessionary levels." She emphasized the considerable impact of these layoffs in terms of payroll dollars.
This surge in tech layoffs coincides with ongoing discussions about how artificial intelligence might disrupt various industries, from finance to software and legal services. While many public firms are integrating AI, even using it to streamline their workforce, the stock market's reaction to such reductions has been unpredictable, underscoring the uncertainty surrounding widespread AI adoption.
30-year fixed mortgage rate hits highest level since July 2025
The average rate for a 30-year fixed mortgage reached 6.68% on Monday, marking its highest level since July 31, 2025, when it stood at 6.75%.
Mortgage rates are closely tied to the performance of the 10-year Treasury yield, which recently climbed to 4.631%, its highest point since February 12, 2025.
Stocks making the biggest moves after the bell: Agilysys, Akamai Technologies
Here's a look at stocks making significant moves in extended-hours trading:
- Agilysys — The hospitality software stock surged 16% after reporting fourth-quarter adjusted earnings of 63 cents per share, an increase from 54 cents a year ago. Agilysys' revenue of $82.9 million also surpassed FactSet analysts' expectations of $81.6 million. Furthermore, the company provided full-year revenue guidance between $365 million and $370 million, exceeding the consensus estimate of $363.6 million, according to FactSet.
- Akamai Technologies — Shares slipped 3% after the cloud computing and cybersecurity firm announced a proposed offering of convertible senior notes, totaling $2.6 billion.
Stock futures are little changed
Stock futures remained largely flat on Monday night. Shortly after 6 p.m. ET, futures across all three major averages were trading near the flatline.
