US stock futures traded lower on Thursday, with technology stocks leading the declines after Google-parent Alphabet raised its capital spending outlook, reigniting investor concerns over the soaring cost of the artificial intelligence race.
Nasdaq-100 futures were down 0.3%, while Dow Jones futures fell 0.4% (226 points) and S&P 500 futures slipped 0.4% in pre-market trading
Alphabet shares dropped 3.9% before the opening bell after the company increased its 2026 capital expenditure forecast to as much as $205 billion, citing robust demand for AI infrastructure.
ALSO READ | Brent Nears $100/Barrel As Red Sea Twist To Hormuz Deadlock Rattles Oil Market
The revised spending outlook comes at a time when investors have become increasingly cautious about the massive AI investments being made by hyperscalers, even as companies continue to defend the spending as necessary to meet surging demand.
According to CNBC, the weakness in technology shares spilled over into broader US equity futures. In the previous session, the Dow Jones Industrial Average ended little changed, while the S&P 500 slipped 0.14% and the Nasdaq Composite lost 0.57%.
Investor sentiment was also dented by a sharp rally in crude oil prices amid escalating geopolitical tensions in the Middle East.
Brent crude climbed to its highest level in months on Thursday, advancing 4.9% to $98.61 a barrel, as mounting tensions in the Red Sea and an unresolved standoff around the Strait of Hormuz and now Bab-el Mandeb revived concerns over potential disruptions to global oil supplies.
US West Texas Intermediate crude advanced about 4% to $90.29. Both benchmarks touched their highest levels since before the US and Iran agreed to end hostilities last month.
ALSO READ | Gas Supply Fears: Petronet LNG Shares Plunge 4% On Fears Of QatarEnergy Extending Force Majeure
The move pushed Brent within striking distance of the $100-a-barrel mark, a level viewed by investors as both psychologically and economically significant.
Reuters reported that oil prices surged after Yemen's Iran-backed Houthi group claimed attacks on two Saudi oil tankers in the Red Sea. Markets also reacted after US President Donald Trump threatened military strikes on Iranian infrastructure, raising fears of a wider regional conflict.
Markets will continue to track corporate earnings, AI-related spending plans from major technology companies and developments in the Middle East for further direction.
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.