Nasdaq set to start in red to extend five-week losing run

• Nasdaq futures fell 0.8%, leading declines ahead of the S&P 500 (-0.4%) and Dow Jones (-0.2%), as investors question returns on massive AI spending commitments
• US software and services sector now trades at a discount to the broader market for only the second time in 30 years, according to Hargreaves Lansdown
• Key catalysts ahead include Palo Alto Networks earnings, Federal Reserve meeting minutes on Wednesday, and Friday's core PCE inflation data

Market Summary: Nasdaq Extends Losing Streak Amid Tech Sector Concerns

Key Market Movements:

US stock futures opened lower on Tuesday, February 17, 2026, with the tech-heavy Nasdaq futures down 0.8%, S&P 500 down 0.4%, and Dow Jones down 0.2%. The Nasdaq is experiencing its fifth consecutive weekly decline—the longest losing streak since 2022. Last week saw the S&P 500 drop 1.4%, the Nasdaq fall over 2%, and the Dow retreat 0.9%.

Primary Concerns:

AI-related disruption fears are driving market weakness across multiple sectors. Investors are questioning returns on massive AI infrastructure investments, with some cash-rich corporations halting spending commitments. Software companies face particular scrutiny due to intensifying competition from AI technologies, with the US software and services sector now trading at a discount to the broader market for only the second time in 30 years.

Analyst Perspectives:

Trade Nation's David Morrison notes declining upside momentum across US major indices since early February, citing concerns about return on investment in big tech and AI stocks. Hargreaves Lansdown's Aarin Chiekrie suggests current valuations present buying opportunities for investors willing to accept near-term volatility.

Upcoming Catalysts:

Investors await key earnings reports from Palo Alto Networks (Tuesday after-hours), DoorDash, Walmart, and Wayfair later this week. Critical economic data includes Federal Reserve meeting minutes (Wednesday) and core PCE inflation data (Friday).

Market Sentiment:

Analysts indicate investors are cautious, awaiting catalysts that will provide clearer directional signals before adding exposure at current levels.