Traders work on the floor of the New York Stock Exchange during the morning trading on November 07, 2024 in New York City.
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Stock futures were lower early Tuesday as geopolitical tensions weighed on sentiment, while investors awaited key earnings from retailers and chipmaker Nvidia this week.
Futures tied to the Dow Jones Industrial Average dropped 236 points, or 0.6%. S&P futures fell about 0.4%, while Nasdaq 100 futures traded 0.3% lower.
Those declines come after Russian President Vladimir Putin warned the U.S. on Tuesday that the threshold for the use of nuclear weapons had lowered. Under the new doctrine, Russia would consider using such weaponry if it — or allies — were met with “with the use of conventional weapons that created a critical threat to their sovereignty and (or) their territorial integrity.”
The new stance comes after President Joe Biden allowed Ukraine to use U.S. weapons to strike inside Russia. Bloomberg News also reported, citing RBC Ukraine, that Ukraine hit Russia with U.S.-made missiles for the first time.
Investors sought protection amid the rising tensions. The Cboe Volatility Index (VIX), considered the best “fear gauge” on Wall Street, spiked above 16. Gold futures were up nearly 1%, and Treasury yields fell.
This comes as traders await key earnings from Walmart, which is slated to report Tuesday. The report can give investors insight into the health of the consumer.
Nvidia is also set to post its latest quarterly figures Wednesday. Eyes will be on how much demand the company signals for its Blackwell AI chips.
About 93% of S&P 500 companies have reported quarterly results so far, with three-quarters exceeding expectations and more than 60% beating revenue estimates, according to FactSet.
Wall Street is coming off a mixed session. The Nasdaq gained 0.6%, snapping a four-day losing streak, while the S&P 500 added about 0.4%. The Dow fell about 55 points, or 0.1%, marking three consecutive down sessions for the 30-stock index. Last week, a postelection sell-off was sparked by concerns about the future path of interest rates given a strong economy and labor market.
“The market has been in an uptrend because of a strong economy, the Fed continually cutting rates, and strong Q3 earnings,” said Andrew Slimmon, Morgan Stanley Investment Management’s head of the applied equity advisors team. “The market is set up well for equities, and investors are not going to see the pullback they want.”
