Apple's shares increased by 2.1% after the company reported that its forecast for iPhone sales during the holiday quarter exceeded Wall Street's expectations.


With the majority of the "Magnificent Seven" companies—responsible for approximately 35% of the S&P 500’s market cap—having released their quarterly results, investors are reassessing Big Tech's aggressive investments in artificial intelligence.


However, this spending spree has raised concerns in the market.


"The concern is not about the high spending levels, but rather the lack of immediate returns in earnings, which may not catch up with these expenditures," stated Ipek Ozkardeskaya, a senior market analyst at Swissquote Bank.


On Thursday, both the S&P 500 and Nasdaq experienced their largest percentage drops since October 10, with the benchmark index closing at its lowest level in over a week.


As of 07:05 a.m. ET, Dow E-minis were down 12 points (0.03%), while S&P 500 E-minis rose by 42.5 points (0.62%) and Nasdaq 100 E-minis climbed 298.5 points (1.16%).


According to data from LSEG, of the 278 S&P 500 companies that have reported their third-quarter earnings so far, 83.1% have exceeded analysts' projections.



The Nasdaq is poised for its seventh consecutive monthly gain, marking its longest streak since May 2017, while the S&P 500 and blue-chip Dow are on track for their sixth consecutive monthly rise.


Earlier in the month, expectations for quicker Federal Reserve rate cuts had supported stock prices, but markets are now adjusting to a shift in policy following the central bank's anticipated quarter-point cut. The Fed's recent statements suggest that another rate cut in December is not guaranteed.


This cautious tone has led traders to reduce their expectations for a third rate cut this year, with futures now indicating a 67.9% chance of a similar move in December, down from nearly 90% earlier in the week.


In other premarket activity, Warner Bros Discovery's shares rose 3.6% after reports emerged that Netflix is considering a bid for its studio and streaming division. Netflix's stock increased by 2.5% following its announcement of a 10-for-1 stock split. Western Digital's shares jumped 10% after forecasting quarterly earnings above Wall Street expectations, while Strategy's stock rose 5.9% after reporting a profit in the third quarter, contrasting with a loss a year prior.