Key Notes
- Nasdaq-100 futures fell 1.06% in the early October 29 snapshot, while S&P 500 and Dow futures rose modestly.
- Alphabet declined 10.38% premarket and Microsoft gained 3.73%, highlighting contrasting reactions to AI spending and cash generation.
- The Fed held rates at 3.75%–4.00%, with GDP and September PCE data scheduled for 12:30 UTC on October 29.
Nasdaq-100 futures fell more than 1% early on October 29 as Alphabet’s earnings selloff weighed on technology sentiment, even as Microsoft gained and futures linked to the S&P 500 and Dow Jones Industrial Average moved higher.
CNBC’s 09:44 UTC market update showed Nasdaq-100 futures down 1.06%, compared with gains of 0.28% for S&P 500 futures and 0.19% for Dow futures. The figures are premarket snapshots, not closing returns or a prediction of the opening level.
The uneven moves followed the Federal Reserve’s decision to leave rates unchanged and came ahead of new inflation and growth data. Investors were weighing the cash generated by the AI expansion alongside the spending required to sustain it.
Tech Futures Diverge From the Broader Market
The futures split followed a positive Wednesday session. The S&P 500 rose for a third consecutive day, while the Nasdaq Composite gained about 0.3%, according to CNBC.
Micron Technology Inc. (NASDAQ: MU) jumped almost 6% and Broadcom Inc. (NASDAQ: AVGO) added more than 2%, helping support the earlier advance. The overnight reaction to new earnings then presented a different test for technology investors.
The Nasdaq-100 and Nasdaq Composite are different indices, and the futures quotation should not be treated as a 1.06% decline in the cash Composite. Likewise, positive S&P and Dow futures do not establish that every sector is advancing.
Alphabet and Microsoft Face Different Cash-Flow Tests
Alphabet Inc. (NASDAQ: GOOGL, GOOG) was down 10.38% in the premarket snapshot, while Microsoft Corp. (NASDAQ: MSFT) gained 3.73%. We reported earlier on the contrasting reactions to their earnings.
Alphabet’s quarterly report showed negative free cash flow of $9.07 billion. Operating cash flow of $42.29 billion was exceeded by $51.36 billion in cash purchases of property and equipment.
The group maintained its $195 billion–$205 billion capital-spending outlook for calendar 2026. Strong cloud revenue growth therefore coexists with a substantial near-term investment requirement, making cash conversion a central issue for shareholders.
Microsoft remained free-cash-flow positive at $18.63 billion, although that measure fell 27% from a year earlier. Its revenue reached $92.28 billion and adjusted earnings were $4.89 per share, as we previously reported. Azure growth of 48% helped support the earnings beat.
Capacity Delays Complicate the AI Supplier Outlook
Microsoft’s capital expenditure, including finance leases, totaled $45.2 billion, below the roughly $50.67 billion analysts expected. The shortfall drew attention to the timing of infrastructure delivered by outside partners.
Management’s earnings call attributed part of the gap to delayed third-party capacity. It also pointed to capital spending above $50 billion next quarter and faster investment in the second half of fiscal 2027 as capacity arrives.
That is a delivery-timing issue rather than confirmation that Microsoft has permanently reduced its AI ambitions. The company continues to describe demand as exceeding available supply.
For infrastructure suppliers, however, timing can affect when projects begin producing revenue against their financing commitments. CoreWeave and Nebius shares fell in the previous evening’s extended trading, as we reported. Those after-hours moves should be distinguished from Thursday’s separate futures and stock quotations.
The Fed Pause Leaves the Inflation Question Open
The Federal Open Market Committee held its target range at 3.75%–4.00% on October 28 by a 10–2 vote. Governor Lisa Cook and Cleveland Fed President Beth Hammack preferred a quarter-percentage-point increase, according to the Fed’s statement.
The committee described strong economic activity, resilient domestic spending and robust capital investment, while emphasizing that inflation remains elevated. It said additional information would help determine the policy stance needed to return inflation to 2%.
As we reported, the pause leaves the next decision open. It does not establish that the tightening cycle has ended, and the two dissents show that some policymakers wanted more immediate restraint.
For equities, that distinction matters alongside earnings. Future financing costs and the returns available from bonds influence how investors value corporate cash flows, particularly when businesses are committing large sums to projects that take time to generate revenue.
Inflation Data and More Earnings Set the Next Tests
The Bureau of Economic Analysis calendar schedules the advance estimate of third-quarter GDP and September personal income and outlays for 8:30 a.m. Eastern on October 29, or 12:30 UTC. The latter includes the personal consumption expenditures price indices used in assessing inflation.
Those reports had not been released at the time of the quoted premarket update. GDP will provide a new estimate of economic growth, while PCE will add price information after the Fed’s decision to wait for more evidence.
Further earnings also remain ahead. CNBC’s calendar highlights Caterpillar Inc. (NYSE: CAT) and Eli Lilly and Co. (NYSE: LLY) before the opening bell, followed by Amazon.com Inc. (NASDAQ: AMZN) and Intel Corp. (NASDAQ: INTC) after the close.
Thursday’s early market is therefore a provisional response to the information already available. The inflation releases, company guidance and regular-session trading will test whether the split between technology futures and the broader indices persists.
