AI Boosts Market Confidence Amid Earnings Wave

The S&P 500 and Nasdaq are set for a strong open as Palantir Technologies' shares rose due to high demand for AI tools boosted by U.S. military spending. Positive forecasts from Teradyne and attention on Alphabet and Amazon earnings, coupled with AI-related spending, provide market momentum.

The S&P 500 and Nasdaq are poised for a robust opening as investors focus on earnings reports. Palantir Technologies saw its shares surge 11.2% premarket, driven by strong demand for its AI tools supported by U.S. defense budgets. Teradyne also soared by 22% after projecting a solid first-quarter forecast, benefiting from substantial AI investments by tech giants.

Key players like Alphabet and Amazon will report earnings later this week, potentially providing insights into AI commercialization. Advanced Micro Devices and Super Micro Computer also gained ahead of their reports. The market is witnessing strategic positioning ahead of earnings, as tech companies face pressure to justify their capital expenditures.

However, PayPal shares plummeted 17.2% following a weaker-than-expected profit forecast for 2026. Macroeconomic activities are in focus as the U.S. House attempts to resolve a shutdown affecting economic data releases. Meanwhile, analysts predict an 11% rise in S&P 500 earnings for the December quarter, highlighting strong market anticipation.

(With inputs from agencies.)