North American Morning Briefing: Stock Futures Drop as Chip Selloff Deepens

OPENING CALL

Stock futures were down Friday as a selloff in stocks linked to the artificial-intelligence buildout continued to reverberate across the globe.

Nasdaq-100 futures were down around 2% this morning, following a bruising session overseas that sent Taiwan and Japan's benchmark indexes falling 6.5% and 4%, respectively.

Bouts of volatility have plagued chip stocks in recent weeks as some investors worry that valuations and AI spending might be too high.

Meanwhile, oil prices were on track for a weekly gain of more than 10% as rising U.S.-Iran tensions raise concerns about broader upheaval.

The U.S. struck multiple bridges in Iran on Thursday, part of an effort to cut off supply routes to a port city and naval base that Tehran uses to attack ships in the region.

Stocks to watch

Intel, Micron Technology, Marvell Technology, Advanced Micro Devices: Chip stocks slid across the board in premarket trading amid mounting skepticism about the sustainability of the AI boom.

Netflix: Shares fell sharply in premarket trading after the streaming company reported its weakest revenue growth in years on Thursday.

Space Exploration Technologies: Shares of Elon Musk's rocket company dropped premarket following Thursday's aborted Starship launch.

Truist Financial, FifthThird Bancorp: The regional lenders are set to report results before the opening bell, closing out a major week for banking sector earnings.

Watch For:

U.S. New Residential Construction - Housing Starts and Building Permits for June; U.S. Industrial Production and Capacity Utilization for June; U.S. University of Michigan Survey of Consumers - preliminary for July

Today's Top Headlines/Must Reads:

- Trump Stirs China Tensions With Claims That It Meddled in U.S. Elections

- Meta Plans to Hire Top Amazon Computing Executive as it Weighs Cloud Push

- The U.K. Gets Another New Leader on Monday. His First Task: Reassure the Markets.

MARKET WRAPS

Forex:

The dollar was steady as oil prices stabilized after rising recently, even as hostilities between the U.S. and Iran continue.

The euro traded flat. Danske Bank expects the currency to gradually weaken against the dollar over the coming months.

Sterling fell against the euro, pulling from a recent 13-month high. An imminent change of leadership in the U.K. raises concerns that sterling could be overvalued in the short term and the currency could give back its recent gains, ING said.

Bonds:

Treasury yields declined in early trade, while Brent oil prices rose, continuing to trade around the $85-per-barrel level amid ongoing hostilities between the U.S. and Iran.

Energy:

Oil prices edged higher, with Brent crude rising almost 2%, while WTI futures were up more than 1.5%.

Metals:

Gold prices slipped below $4,000 a troy ounce and are on track for a weekly decline of more than 3%. Escalating hostilities between the U.S. and Iran are fueling fears that higher energy prices could keep inflation elevated and prompt the Fed to raise interest rates.

Copper

Copper prices were lower in early trading and expected to stay range bound in the near term, according to Nanhua Futures.

Iron

Iron ore rose as inventories fell. The pressure on supply is expected to ease as overseas iron-ore shipments to China fall from their peak in 1H, Nanhua Futures said.

   TODAY'S TOP HEADLINES 

China's Moonshot AI Releases Model to Challenge Top U.S. Systems

China's Moonshot AI has launched an artificial-intelligence model it says outperforms some cutting-edge U.S. systems, the latest sign that Chinese labs can rival American counterparts in critical technology frontiers.

Moonshot said Friday that it planned to fully open-source the model, called Kimi K3, by late this month, where people will be generally free to download and adapt. With 2.8 trillion parameters dictating its decision-making, Kimi K3 is the world's biggest open-source model, according to the Beijing-based startup.

Meta Plans to Hire Top Amazon Computing Executive as it Weighs Cloud Push

A top executive at Amazon's cloud division plans to join Meta Platforms in the coming weeks, a sign of the social-media giant's growing ambitions in developing data centers and computing resources.

Dave Brown, one of the most senior executives at Amazon Web Services, will bring his nearly two decades of experience to Meta, where he will report to the company's head of infrastructure and focus on the firm's data center build-out, according to people familiar with the matter.

Databricks Set to Hit $188 Billion Valuation With New Investment From Coatue

Coatue Management is leading a $3 billion investment in Databricks, a data-analytics software provider, that values the company at $188 billion, according to people familiar with the matter.

The new financing represents a 40% increase from its valuation in December, when Databricks raised money at a $134 billion valuation. The San Francisco-based company has been a major beneficiary of the artificial-intelligence boom.

Netflix Revenue and Profit Increase, but the Company Expects Growth to Slow

Netflix said it expects revenue and profit gains to slow in the third quarter, exacerbating investor fears that the company's growth is topping out.

Shares fell more than 8% in after-hours trading, after the company forecast revenue growth of 11.7%-its smallest year-on-year increase of any quarter since late 2023.

Gas Prices Will Stay Higher for Longer, Even if Oil Falls

President Trump has succeeded at times in calming crude-oil markets even as the Iran war rages on. But he doesn't have the same sway over gasoline prices, which ultimately matter more to consumers.

Despite the resumption of U.S.-Iran hostilities, U.S. benchmark crude prices are hovering around $80 a barrel. That is about 18% above where they were before the Iran war began. By contrast, gasoline prices remain 32% higher at $3.94 a gallon, according to energy data firm OPIS.

Trump's Tightening Squeeze on Iran Will Heap More Pain on Its Battered Economy

DUBAI-President Trump is betting that reimposing the blockade on Iran and revoking its right to sell oil will throttle the regime's economy and convince it to release its hold on the Strait of Hormuz. Tehran is betting it can hold out.

The danger is, in the short term at least, that the renewed economic pressure hurts ordinary Iranians and leaves a destructive stalemate in the waterway.

The U.K. Gets Another New Leader on Monday. His First Task: Reassure the Markets.

LONDON-Britain is on the threshold of its sixth prime minister in seven years, as Andy Burnham prepares to enter Downing Street having executed an understated coup while mayor of Manchester to become the leader of the ruling Labour Party.

His appointment as premier, which will be formalized by King Charles at Buckingham Palace on Monday, marks the climax of a steep ascent for a politician who until last month wasn't even a lawmaker. In the past few weeks Burnham, a telegenic 56-year-old, has sketched out a vague plan for how he would revive the fortunes of his beleaguered Labour Party and steady a country where growth has flatlined and an upstart anti-immigration party dominates the political conversation.

SEC Flooded With Complaints Over Plan to Scrap Required Quarterly Earnings

The Securities and Exchange Commission asked the public what it thought about its proposal to no longer require public companies to report quarterly financial results.

More than 200,000 comments-overwhelmingly negative-rolled in.

Trump Stirs China Tensions With Claims That It Meddled in U.S. Elections

President Trump's claims of Chinese interference in the 2020 U.S. elections add a new irritant to a tenuous detente with Beijing already strained by trade and technological competition.

Delivered in a televised speech on Thursday, the allegations marked an escalation in Washington's long-running criticism of perceived Chinese efforts to influence American politics-typically centered on the alleged use of propaganda and subterfuge to shape U.S. policies toward Beijing.

The U.K. Gets Another New Leader on Monday. His First Task: Reassure the Markets.

LONDON-Britain is on the threshold of its sixth prime minister in seven years, as Andy Burnham prepares to enter Downing Street having executed an understated coup while mayor of Manchester to become the leader of the ruling Labour Party.

His appointment as premier, which will be formalized by King Charles at Buckingham Palace on Monday, marks the climax of a steep ascent for a politician who until last month wasn't even a lawmaker. In the past few weeks Burnham, a telegenic 56-year-old, has sketched out a vague plan for how he would revive the fortunes of his beleaguered Labour Party and steady a country where growth has flatlined and an upstart anti-immigration party dominates the political conversation.

China's Xi Touts Open-Source AI and Takes a Swipe at U.S. Dominance

SHANGHAI-Chinese leader Xi Jinping endorsed the building of open-source artificial-intelligence models, touting an approach that has helped the country catch up with the U.S. in global influence.

Speaking here Friday at an AI conference, Xi cast China as a champion of openness and equality, implicitly criticizing U.S. moves to protect its lead in AI semiconductors and models.

Write to priscila.barrera@wsj.com

TODAY IN CANADA

Earnings:

Nothing major scheduled.

Economic Indicators (ET):

0830 May International transactions in securities

Stocks to Watch:

Bridgemarq Real Estate Services Declares Annualized Dividend Rate of C$0.05; Dividends Expected to Be Paid on Quarterly Basis; Sees Canadian Residential Real Estate Industry Entering Period of Rapid Consolidation; Sees Canadian Residential Real Estate Industry Entering Period of Technology-Driven Transformation

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July 17, 2026 06:11 ET (10:11 GMT)

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