S&P500 and Nasdaq Index: US Stocks Brace for Major Tech Catalysts to Shape the Week Ahead

• IBM's near-13% collapse led Monday's rout, with software (Microsoft, CrowdStrike) and cybersecurity stocks experiencing significant losses as risk appetite weakened
• Market strategist Warren Pies downgraded U.S. equities to neutral, noting consumer staples and energy gained over 10% while tech and financials underperformed, preventing a bullish breakout
• Key catalysts this week include consumer confidence data, Home Depot earnings Tuesday, and critical tech earnings from Nvidia, Salesforce, and Snowflake that could determine whether tech stocks recover

Market Summary: US Stocks Stabilize After Tech-Led Selloff

Key Market Movements:

US equity indices stabilized Tuesday morning following a sharp Monday selloff driven by AI-related job concerns, trade tensions, and geopolitical instability. The Dow Jones Industrial Average plunged 822 points (-1.7%) on Monday, while Tuesday futures showed modest recovery: Dow futures +0.12%, S&P 500 futures +0.17%, and Nasdaq 100 futures +0.27%.

Major Catalysts:

IBM collapsed nearly 13% on Monday, leading the Dow's decline. Software and cybersecurity sectors experienced the heaviest losses, with Microsoft and CrowdStrike among the worst performers. Banks also suffered significant declines as risk appetite deteriorated.

Sector Performance:

Year-to-date sector divergence remains pronounced. Consumer staples and energy have delivered double-digit gains exceeding 10%, while technology and financials have underperformed significantly.

Market Outlook:

Warren Pies of 3Fourteen Research downgraded US equities to neutral earlier this month, citing poor momentum and weak sector rotation. He emphasized that any bullish breakout requires technology sector recovery, stating "there is no way to break this with continued weakness in tech and financials."

Critical Upcoming Events:

• Anthropic product announcement (Tuesday) added Monday's software sector pressure
• Home Depot earnings (Tuesday)
• Consumer confidence report (Tuesday)
• Major earnings from Nvidia, Salesforce, and Snowflake later in the week

These tech earnings reports will be crucial catalysts determining whether technology stocks can regain leadership and drive broader market recovery. Analysts recommend caution until a definitive range break occurs.