Context:

Stocks and futures were cautiously mixed ahead of a week driven by inflation data and AI earnings, with technology shares showing tentative recovery after Thursday’s selloff. Investors weigh regulatory risks for AI infrastructure and the implications of stronger jobs data, while Nvidia faces an internal probe into a relationship linked to a Chinese spy, fueling risk-off sentiment. Markets also monitor capital expenditure plans and margin expectations as guidance from upcoming reports shapes near-term momentum. The near-term outlook hinges on CPI, PPI, and key earnings, with traders watching whether retail demand rekindles the late-summer rally or remains on the sideline. Outlook remains uncertain as regulatory and geopolitical factors intersect with corporate earnings and macro data.

Dive Deeper:

• Over the weekend, futures pointed to modest gains for the Dow and broad gains for the S&P 500 and Nasdaq, as investors awaited inflation readings and AI-sector earnings next week.

• Friday’s session saw the Nasdaq Composite rebound more than 1% after a sharp decline in earlier trading, while the Dow fell about 0.5% and the S&P 500 rose fractionally, signaling cautious optimism amid persistent risk factors.

• A key development is the announcement that Nvidia’s board is investigating CEO Jensen Huang’s relationship with a businesswoman flagged by U.S. intelligence as connected to Chinese intelligence, adding a political overhang to tech equities.

• Analysts note the Nasdaq–Nasdaq-100 are oversold, with heavy de-risking by traders, and caution that retail buyers have not re-emerged to support a sustained bounce.

• Investors will focus on AI-related earnings from CoreWeave, Cisco, and Applied Materials, along with this week’s CPI and PPI releases to gauge the Federal Reserve’s likely policy path.

• Monday’s economic calendar includes wholesale inventories data, and several major names such as Take-Two Interactive, Occidental Petroleum, KKR, Constellation Energy, and Skydance are due to report quarterly results.

• Regional markets in Asia-Pacific are showing relative strength as the week opens, with attention on inflation readings in China and how they influence global risk sentiment.