Oct 23 (Reuters) - Wall Street futures ticked lower on Friday as caution prevailed after a sharp selloff in AI-linked stocks over concerns about the sector's massive funding requirements, while telecom shares slid on fears of increased competition from SpaceX.
AT&T (T.N), , Verizon (VZ.N), and T-Mobile (TMUS.O), were down more than 4% in premarket trading after a report said SpaceX (SPCX.O), was in talks with cellular infrastructure companies about launching a nationwide wireless carrier program. US cell tower operators, however, gained from this news, with Crown Castle (CCI.N), up 8.6% and American Tower (AMT.N), up 6.1%.
SpaceX shares gained 1.5%.
AI-related shares swung sharply this week, first coming under pressure over CoreWeave's (CRWV.O), debt burden and the cost of financing AI investment, then rallying on Wednesday after upbeat results from SpaceX (SPCX.O), and Super Micro (SMCI.O), .
The gains reversed on Thursday and the tech-heavy Nasdaq (.IXIC), fell nearly 3%. The slide accelerated following Meta's (META.O), nearly 8% decline after the Facebook parent reported its first cash outflow in more than a decade amid concerns over its AI-related expenditures.
On Friday, CoreWeave shares were flat, and 'Magnificent 7' stocks were little changed, with Meta down 0.6%.
Market focus remains on the earnings season, with major companies such as Microsoft (MSFT.O), , Alphabet (GOOGL.O), and Amazon (AMZN.O), reporting next week.
"Given the concentration of these companies within US indices, their results could have significant implications for broader market sentiment," said Daniela Hathorn, senior market analyst at Capital.com.
"Investors are becoming increasingly demanding when it comes to AI investment, with attention shifting from revenue growth towards profitability, capital expenditure and tangible returns."
At 07:19 a.m. ET, Dow E-minis were down 314 points, or 0.59%, and S&P 500 E-minis were down 19.25 points, or 0.25%. Nasdaq 100 E-minis were down 33.75 points, or 0.12%.
Brent crude held near a more than five-month high amid Middle East supply concerns, adding to inflation worries ahead of the Federal Reserve's policy meeting next week.
Nasdaq was on track for a weekly loss, while the benchmark S&P 500 and the blue-chip Dow remained higher, supported by gains in defensive sectors as investors sought refuge from volatility in technology stocks.
S&P 500's third-quarter profit growth is now forecast at 32.3%, up from 30.7% previously, according to LSEG data.
In other premarket moves, gold miner Newmont (NEM.N), fell 1.3% after reporting quarterly results and warning that unit costs are expected to trend higher in 2027.
Bloom Energy (BE.N), dipped 1.6% even after the energy firm raised its fiscal 2026 forecast.
Reporting by Tharuniyaa Lakshmi and Ragini Mathur in Bengaluru; Editing by Shinjini Ganguli
