SpaceX's strong quarterly report reignited market confidence in the investment outlook for artificial intelligence, prompting U.S. stock futures to rise, with technology stocks leading the gains.
S&P 500 futures rose 0.2%, and Nasdaq 100 futures increased 0.7%. SpaceX surged approximately 9% after AI business revenue skyrocketed 830% year-over-year and became its largest revenue source for the first time, with net profit exceeding expectations by 2.3 times, boosting market sentiment. Meanwhile, Super Micro Computer released strong preliminary quarterly results, rising about 15% in pre-market trading, further reinforcing the market narrative of sustained strong demand for AI.
However, bullish sentiment was somewhat restrained. Oil prices rose again, with Brent crude approaching $110 per barrel, as threats of attacks on vessels near the Strait of Hormuz raised supply concerns, while U.S. crude oil inventory data showed a decline of 4.9 million barrels. U.S. Treasury yields and the dollar showed little movement. Netflix fell about 6% in pre-market trading after missing expectations for fourth-quarter revenue and advertising income, becoming the day’s main drag.
Stephan Kemper of BNP Paribas Wealth Management Germany said: "Investors are inherently emotionally polarized. The strong data and positive guidance demonstrated by SpaceX and Supermicro are exactly the medicine the market needs right now."
S&P 500 futures rose 0.2%, and Nasdaq 100 futures increased 0.7%. SpaceX rose approximately 9%, Super Micro Computer rose about 15%, and Netflix fell around 6%. The euro declined 0.1% to $1.1224; the U.S. 10-year Treasury yield remained largely unchanged at 5.11%; Germany’s 10-year yield stayed steady at 3.40%; Brent crude oil rose 0.9% to $109.72 per barrel; spot gold fell 0.1% to $4,120.68 per ounce.
SpaceX quarterly report sparks AI trading
SpaceX's third-quarter revenue reached $14.58 billion, a 161% year-over-year increase; AI business revenue surged 830% year-over-year, surpassing all other segments for the first time to become the company's largest single source of revenue; net profit exceeded market expectations by 2.3 times.
According to Bloomberg, ING’s Chief Investment Strategist Simon Wiersma said: “SpaceX has provided the answer the market has been seeking—demand related to AI remains real. This not only boosts confidence in SpaceX itself but also improves sentiment toward the entire AI ecosystem.”
Additionally, Elon Musk expressed support for a potential merger between SpaceX and Tesla, further driving up SpaceX's stock price.
Anthropic's trillion-calculus computing initiative helps restore market confidence
SpaceX's better-than-expected financial results, combined with reports that Anthropic PBC plans to invest up to $750 billion in computing infrastructure over the coming years, have collectively alleviated recent market concerns driven by high valuations and funding pressures.
Stephan Kemper of BNP Paribas Wealth Management Germany said: "Investors are inherently emotionally polarized. The strong data and positive guidance demonstrated by SpaceX and Supermicro are exactly the medicine the market needs right now."
The tech earnings season will continue this week, with Meta Platforms and Tesla set to report earnings after the market close on Wednesday, as investors closely watch whether AI investments can continue to deliver returns.
Super Micro's preliminary quarterly report beat expectations, but Netflix's guidance weighed on sentiment.
Super Micro Computer announced preliminary results for its first fiscal quarter, with revenue exceeding analyst expectations by 27%, causing its stock to surge approximately 15% in pre-market trading, further confirming strong demand for AI computing infrastructure.
In contrast to the strength in the technology hardware sector, Netflix fell about 6% in pre-market trading. The company’s Q4 revenue guidance and advertising income both fell below market expectations, weighing on sentiment in the streaming sector.
Markets in Europe and Asia showed divergent performance.
In European markets, the Stoxx 600 index edged higher, with gains in energy and technology sectors offset by declines in consumer-related sectors. The Stoxx 50 opened up 0.3%, the French CAC 40 rose 0.1%, the German DAX remained flat, and the UK FTSE 100 fell 0.1%. The yield premium of French 10-year government bonds over their German counterparts widened to over 155 basis points.
In Asian markets, regional stock benchmarks rebounded overall, with the Korea Composite Stock Price Index (KOSPI) leading the gains. Elice Inc. in South Korea saw its shares surge 30% in a single day after one of the worst IPO debut performances in South Korean history.