Markets Rebound Ahead of Key Economic Data and Midterm Elections
U.S. stock futures rose on Monday following last week's sharp declines, as traders brace for a pivotal week featuring corporate earnings, employment data, and the upcoming U.S. midterm elections. Tech-heavy indices had their worst October since March 2025, with semiconductor stocks particularly hard hit, while broader market sectors showed resilience. Investors are closely watching election prediction markets and economic indicators like PMI reports amid rising geopolitical tensions affecting oil prices.
U.S. stock futures rose on Monday, November 2, 2026, following a sharp selloff in the prior week that saw the Nasdaq post its worst monthly decline since March 2025 and fall 2.86% on Friday—the largest single-day percentage drop since June 5. The S&P 500 and Dow also declined for a third consecutive week, marking their longest losing streak since March. Despite this, tech-heavy indices showed signs of recovery in early trading, with the Nasdaq futures up 0.84% and the S&P 500 up 0.54%. The downturn was particularly severe for semiconductor stocks, with the iShares Semiconductor ETF (SOXX) falling 17% in October and closing below its 200-day moving average. In contrast, defensive sectors like Healthcare (XLV), Utilities (XLU), and Consumer Staples (XLP) posted around 10% gains, while Energy (XLE) surged 13% due to elevated oil prices. Oil prices dipped ahead of the U.S. midterm elections on Tuesday, as renewed attacks near the Strait of Hormuz were weighed against diplomatic efforts involving Iran and Qatar. Election prediction markets showed Democrats had a 94% chance of reclaiming the House and a 73% chance in the Senate, up 1% from the previous day. Key economic data due today includes the S&P Global Manufacturing PMI and ISM Manufacturing Index for October. Apple (AAPL) is set to report earnings after the close, adding to market anticipation.
The broader context reflects growing investor anxiety amid geopolitical tensions, shifting fiscal policies, and a volatile earnings
The recent market volatility reflects broader societal concerns about economic stability amid geopolitical risk and shifting policy environments. Investors are increasingly sensitive to both domestic political outcomes and global instability—such as tensions in the Middle East affecting oil prices—highlighting how financial markets serve as a barometer of confidence. The sharp decline in tech stocks, particularly semiconductors, may impact innovation-driven sectors and employment in high-tech industries, potentially slowing investment in AI, cloud infrastructure, and advanced manufacturing. Meanwhile, defensive sectors like healthcare and utilities have gained favor, suggesting a flight to safety that could influence long-term capital allocation across the economy. Comparable to the 2018 midterm elections, when market reactions were driven by uncertainty over fiscal policy and regulatory direction, this year’s results may similarly shape investor sentiment toward infrastructure spendin