US stock futures pointed to a weak start on Wall Street on Monday, September 14, with key US indices resuming their decline in pre-market trading amid concerns over a potential slowdown in artificial intelligence. A jump in crude oil prices ahead of the US Federal Reserve’s policy meeting also added to the cautious mood.
Futures tied to the tech-heavy Nasdaq 100 Index declined 1.8%, while those linked to the S&P 500 and Dow Jones Industrial Average fell 0.8% and 0.3%, respectively. The losses came after the S&P 500 snapped a four-day losing streak on Friday, surging 0.9%. The Dow Jones and Nasdaq Composite also gained around 1% each.
AI- and chip-related stocks were among the biggest casualties in pre-market trading, with Nvidia falling 3%, Intel declining 6%, and Marvell Technology dropping 7%. US hyperscalers also traded lower, with Meta Platforms, Amazon, Alphabet, and Microsoft all edging down.
The weakness followed comments from Anthropic Chief Executive Officer Dario Amodei on Saturday that the company would introduce additional safeguards, including independent third-party evaluations, and urged the broader industry to slow the development of its most advanced models. OpenAI CEO Sam Altman backed the proposal, while xAI’s Elon Musk said, “Dario is right.”
Meanwhile, OpenAI CEO Sam Altman said his company would not go public this year. In an interview with Fortune published on Saturday, Altman said the AI firm would not launch an initial public offering this year as it focuses on safety.
US President Donald Trump has downplayed growing concerns over AI risks, raising questions over how committed industry leaders will be to slowing the development of their most advanced—and lucrative—models amid intense competition from Chinese rivals.
Middle East tensions push oil prices higher
Further disruptions to crude supplies from the Middle East added to the downbeat mood.
Oil prices moved higher early Monday as US-Iran tensions remained elevated and Iran-backed Houthi rebels stepped up attacks targeting Saudi Arabia, prompting Riyadh to close its East-West pipeline as a precaution following the attacks.
Brent crude, the international benchmark, rose 4% to $108.65 a barrel, compared with around $72 a barrel before the start of the war in Iran in late February. US West Texas Intermediate crude gained 3.75% to $103.75 a barrel.
The latest escalation has added to pressure on oil markets, with Iran-backed Houthi rebels targeting Saudi oil infrastructure and shipping in the Red Sea. The attacks have raised concerns over further supply disruptions at a time when global oil supply chains have already remained under pressure since March.
For more than a month, the Houthis have been striking Saudi oil infrastructure and shipping in the Red Sea, increasing pressure on global oil prices and strengthening Iran’s leverage in its war with the United States.
Saudi-backed Yemeni government forces have been attempting to rally and fight back, but Houthi gains have seemingly come with little resistance, AP reported.
Last week, the Houthis captured the port city of Mokha and an island near the Bab el-Mandeb Strait, a crucial shipping route and an alternative to the Strait of Hormuz.
Fed hike bets, Treasury yields in focus
The rise in oil prices has added to inflation concerns ahead of the Federal Reserve’s policy meeting this week. US Treasuries extended losses from last week’s sell-off, which pushed the benchmark 10-year yield closer to 5% after hotter-than-expected US inflation strengthened expectations of higher interest rates.
Swap traders were pricing in a nearly 90% chance that the Federal Reserve would raise its key policy rate on Wednesday, Bloomberg reported.
Inflation concerns stemming from the energy shock caused by the war in Iran, along with rising US government debt, have fuelled a sell-off in government bonds and put further pressure on Treasury yields in recent weeks.
Despite expanded buyback operations by the US Treasury Department aimed at stabilising the bond market, the measures have done little to ease concerns among bond investors. The yield on the 10-year US Treasury, which influences borrowing costs for mortgages, auto loans, and credit cards, was last seen at 4.97%.
(With inputs from agencies)
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