US stock futures fell on Monday, as uncertainty over American trade policy and continuing fears of artificial intelligence-related disruption clouded sentiment.
The US dollar recouped losses while precious metals advanced.
A broad sell-off sent all three major US stock indexes more than 1 per cent lower by the closing bell, as risk appetite was dampened by a combination of persistent fears over AI disruption and President Donald Trump's erratic statements on trade policy, which fuelled much of the market volatility during the first year of his second term.
The S&P 500 lost 70.31 points, or 1.02 per cent, while the Nasdaq Composite lost 251.46 points, or 1.10 per cent. The Dow Jones Industrial Average fell 810.81 points, or 1.65 per cent.
The greenback recovered most of a 0.3 per cent drop. Gold climbed after a run of three weekly gains. Bitcoin briefly slid below $65,000.
Tariff questions are adding another dimension to markets already unsettled by concerns over artificial-intelligence disruption and brewing Middle East tension. Monday’s retreat marks an uneasy start to the week, with Mr Trump’s State of the Union address on Tuesday and Nvidia earnings the following day likely to serve as major catalysts.
Last week, the Supreme Court ruled against Mr Trump's sweeping tariffs on dozens of global trading partners. After the decision, Mr Trump issued first a 10 per cent and later a 15 per cent global tariff.
The latest questions over tariffs could reinforce this year’s pattern of US stocks lagging behind global peers, with unexpected policy decisions pushing investors toward alternatives. Uncertainty over long-term trade policy and its possible impact on earnings at already high valuations is likely to add further pressure on US equities.
Financial stocks and software-related companies underperformed the broader market.
With only 77 of the companies in the S&P 500 yet to post results, fourth-quarter earnings season has neared the finish line. A smattering of high-profile companies are expected to report this week, most notably leading artificial intelligence chip maker Nvidia, due on Wednesday. Home improvement rivals Home Depot and Lowe's are also on the docket, which is rounded out by Salesforce and Universal Health Services.
Of the companies that have reported, 73 per cent have beaten expectations, and analysts now expect aggregate year-on-year S&P 500 earnings growth of 13.9 per cent, significantly higher than the 8.9 per cent forecast as of January 1, according to LSEG data.
