【US Pre-Market】AI Stocks Under Pressure as Tesla Drops Over 5%, IBM Falls Nearly 5% Ahead of WDC Earnings

TradingKey - On Thursday, October 22, US Eastern Time, futures tied to the three major US stock indexes fell across the board in pre-market trading. Earnings from big tech companies failed to fully ease market concerns over the return cycle of AI capital expenditures. Meanwhile, rising shipping risks in the Strait of Hormuz and escalating security concerns surrounding Saudi energy facilities pushed oil prices higher again, putting broad pressure on tech stocks and high-volatility assets.

As of press time, Dow futures were down 0.54%, S&P 500 futures fell 0.93%, and Nasdaq 100 futures dropped 1.63%.

Source: Investing

In commodities, gold (XAUUSD) fell about 1.9%, trading around $4,060; international oil prices rose significantly, with WTI (USOIL) crude up about 1.6% to around $99.2; Brent crude rose about 1.7%, trading around $111.9. Reports from Iran regarding tanker attacks and security risks to Saudi energy facilities prompted the market to re-price a supply disruption premium.

In cryptocurrencies, Bitcoin (BTC) fell about 2.6%, pulling back to around $82,000. Declines in US stock futures and concerns over high AI valuations weighed on overall risk appetite.

Market Moves

Lockheed Martin (LMT) rose about 4.6% in pre-market trading. The company's third-quarter sales grew 11% year-over-year to $20.7 billion, net profit rose 14% to $1.8 billion, and earnings per share came in at $7.97; its backlog reached a record $292 billion. The company also raised its full-year guidance for sales, earnings per share, and free cash flow.

Tesla (TSLA) fell more than 5% in pre-market trading. The company's third-quarter revenue was $28.05 billion, essentially flat year-over-year; net profit dropped to $787 million, down 43% year-over-year, with adjusted earnings per share of $0.48. Tesla lowered its 2026 capital expenditure forecast from over $25 billion to around $20 billion, raising market concerns over the pace of its AI, Robotaxi, and humanoid robot projects.

IBM (IBM) fell about 5% in pre-market trading. The company's third-quarter revenue grew 5% year-over-year to $17.1 billion, and adjusted earnings per share were $2.95, with software revenue up 8%. IBM also raised its full-year free cash flow guidance to a year-over-year increase of more than $1 billion, but the strong financial results failed to prevent the stock from pulling back in pre-market trading.

Lam Research (LRCX) fell about 7.3% in pre-market trading. The company's quarterly revenue reached a record $8.22 billion, up 22% quarter-over-quarter, with adjusted earnings per share of $2.20. The company expects next-quarter revenue to be approximately $8.6 billion, plus or minus $400 million, but against the backdrop of a sharp prior stock rally and elevated market expectations, investors opted to take profits.

Market Headlines

Security risks in the Strait of Hormuz and at Saudi energy facilities have escalated. Iranian state television reported that seven oil tankers were attacked or damaged by mines in the Strait of Hormuz, a claim the Associated Press stated could not be independently verified. Meanwhile, the U.S. State Department ordered the evacuation of certain diplomatic personnel and families of government employees from Saudi Arabia; the Saudi Ministry of Energy reported that debris from intercepted drones killed two people and injured two others at an oil field operated by Saudi Aramco.

Meta (META) will establish non-voting Class C common stock. The company's board of directors approved the creation of publicly traded Class C shares, expected to take effect in January 2027, with plans to distribute one Class C share for each Class A or Class B share. The new shares can be used for financing, employee compensation, and potential acquisitions, while existing shareholders' voting rights will remain unchanged.

OpenAI models will launch on Alphabet's Google Cloud (GOOGL). OpenAI and Google Cloud announced that OpenAI's frontier models and Codex coding agents will be available on Google Cloud Model Garden and Marketplace in the coming weeks, allowing enterprise customers to access the products through their existing Google Cloud procurement systems.

Key Data and Events Preview

At 8:30 AM ET on October 22, the U.S. will release initial jobless claims, with market expectations at 200,000 and the previous reading at 199,000.

At 10:00 AM ET on October 22, the U.S. will release the September Leading Economic Index.

At 11:00 AM ET on October 22, the U.S. will release the Kansas City Fed Manufacturing Index.

After the market close on October 22 ET, Western Digital (WDC), Newmont (NEM), and Deckers Outdoor (DECK) will report quarterly earnings.