The AI Trade Bounces Back: Nasdaq Futures Jump After Last Week's Rout

Last week Wall Street decided the AI trade was broken. This morning it changed its mind — at least until the next headline.

 

The bounce, in numbers

US stock index futures climbed on Monday as AI-related shares rebounded from last week's sharp selloff, helped by easing oil prices and falling Treasury yields, Reuters reported. In premarket trading, CoreWeave rose 1.3%, Broadcom gained 2.3%, Nvidia added 1.1%, Amazon and Meta ticked marginally higher, and Intel jumped 3.8% after JPMorgan upgraded the stock to "neutral" from "underweight."

At 04:59 a.m. ET, Dow E-minis were up 18 points (about 0.03%), S&P 500 E-minis up 36 points (about 0.47%), and Nasdaq 100 E-minis up 292.25 points (about 0.99%). It is a solid bounce — but context matters. Last week the S&P 500 fell 1.95%, its biggest weekly drop since late June; the Nasdaq plunged 4.5%, its worst week since early June, snapping a four-week winning streak. Only the Dow bucked the trend, rising 0.67% for its second straight weekly gain.

Why last week broke

The trigger was, of all things, good news that looked like bad news. CNBC reported that Anthropic told investors its third-quarter revenue reached $16.8 billion, up from about $11.6 billion in the second quarter — spectacular growth that nonetheless raised flags about whether revenue growth is keeping pace with the staggering sums being poured into AI infrastructure. When even a blowout quarter spooks the market, the market is telling you what it fears: not failure, but the bill.

CoreWeave became the poster child for that fear, plunging 25% last week on worries about its debt-funded data-center expansion — its credit default swaps hit distressed levels, the bond market's way of pricing real doubt. The anxiety has a name on trading desks now: sustainability. As Goldman Sachs traders put it on Friday, "AI credit spreads and hyperscalers specifically are at the widest levels of the year. The last time spreads were nearly this high, the underlying equities were 15% lower." The market's focus, they said, is shifting from near-term earnings revisions to whether the AI spending boom can ever earn its keep. For the bigger picture on Anthropic's moment, see our report on Anthropic's new public benefit fund — and for the hardware side of the buildout, our piece on Intel's 700-TOPS AI chip plans.

The credit-market warning

Here is the part the futures bounce doesn't fix: the stress has moved from stocks to credit. When credit default swaps on a flagship AI-infrastructure name trade at distressed levels, lenders are questioning the business model, not the share price. The Goldman note is the clearest articulation of the new regime — equities may bounce on a quiet Monday, but bond investors are demanding to see returns on the hundreds of billions in data-center capex before they believe again.

Two macro tailwinds helped Monday's rebound: Brent crude fell 1.8% to around $107 a barrel after Trump waived some sanctions on Russia — Secretary of State Marco Rubio said the president would take up to 60 days to assess the economic impact — and the 10-year Treasury yield slipped to 5.085%. Cheaper oil and cheaper money are oxygen for growth stocks. But both are fragile: the sanctions waiver is explicitly temporary, and yields can snap back on one hot data print.

What earnings week decides

This is the week that settles the argument. Meta and Tesla report on Wednesday, SpaceX on Tuesday, with Netflix, GM and GE Aerospace also due. If the hyperscalers show AI revenue catching up with AI spending, last week's rout becomes a buying opportunity and the "trade of the decade" narrative — the one that started cracking in our October 13 coverage of the selloff — gets a second life. If they don't, the credit market's verdict starts looking like the right one.

The honest read: Monday's bounce is relief, not resolution. The AI trade isn't dead — but it just got its first real stress test, and the questions it raised about debt, spending and returns aren't going away with one green futures print.

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