As the U.S. mid-term elections officially commenced, the battle for control of Congress entered a critical phase. Investors were reluctant to further increase their risk exposure before the results were known, resulting in a lack of clear direction for U.S. stock index futures on Tuesday. At the same time, concerns about artificial intelligence once again rose, putting pressure on global stock markets.

As of press time, the Dow Jones futures fell by 0.90%, the S&P 500 index futures fell by 0.16%, and the Nasdaq futures rose by 0.09%.

The Stoxx 600 index in Europe fell by 0.3%, making up for the losses in the U.S. stock market after European markets closed on Monday. In the Asian markets, the MSCI Asia-Pacific Index fell by 1.2%, with the South Korean index, which has a higher proportion of tech stocks, falling by more than 3%.

Apple's financial report exacerbates market concerns

Due to narrowing profit margins, Apple's stock price fell by 4.4% in pre-market trading.

Apple released its earnings outlook on Monday, anticipating that due to rising costs of memory chips, the gross margin during the crucial holiday shopping season at the end of the year will decline. In addition, the company expects that revenue growth from its services business will be significantly lower than Wall Street's expectations.

The performance guidance from this iPhone manufacturer has further exacerbated the pessimistic sentiment in the market. Previously, the mediocre financial report results announced by several tech giants had already disappointed investors.

The mid-term elections in the United States are about to begin voting.

As the mid-term elections in the United States begin, the race for control of Congress enters a critical phase, and traders are generally cautious. For investors who are already facing geopolitical risks, these elections add another layer of uncertainty. At the same time, the previous boom in artificial intelligence investment, which has been dominating the market, is experiencing a clear pullback, further intensifying the cautious sentiment in the market.

According to CBS News, Al Jazeera, and the election schedules of various U.S. states, the official voting date for the 2026 U.S. midterms is November 3 (Tuesday), and the first batch of polling stations will open at 18:00 Beijing time on November 3.

Trading data for the forecast market Polymarket indicates that the probability of the Democratic Party gaining control of both the U.S. Senate and House of Representatives is approximately 77%. This outcome could lead to increased supervision of the artificial intelligence industry in the United States, as well as the introduction of more regulatory measures targeting companies.

Social Discovery Ventures Chief Investment Officer Alexander Lis stated: "If the Democrats win outright, I expect there to be some populist policy measures targeting AI. Voices opposing the construction of data centers may also gain more support."

In recent days, the disappointing financial report performances of large technology companies, along with the significantly increased capital expenditure targets, have caused unease on Wall Street and have also made investors pay closer attention to the results of the mid-term elections in the United States.

If the Democrats achieve a great victory on Tuesday evening, especially in the Texas governor's election, markets will worry about increased data center regulations across the United States, which could further trigger selling in the AI sector. Defense stocks may come under pressure due to market concerns about limited military spending, but the healthcare sector is likely to benefit.

Indosuez Wealth Management Chief Investment Officer Alexandre Drabowicz stated: "Investors have been very cautious before the mid-term elections. Historically, the S&P 500 index tends to recover and rise after the elections, and the market fundamentals are still very, very strong. We need to get through these elections first."

The market is in a skeptical phase.

As large technology companies once again turn to the bond market to raise funds for their massive AI investment plans, executives from some of the world's largest asset management firms have begun to warn that there may be a bubble risk in the artificial intelligence industry. After experiencing rapid expansion, the industry could ultimately face a period of downward adjustment.

On Monday, an index tracking U.S.-listed chip manufacturers fell to a six-month low, representing a nearly 30% decline from its peak in June of this year. However, one exchange-traded fund (ETF) that tracks this sector, ETF, rebounded by 2% in pre-market trading on Tuesday.

Emmanuel Roman, the CEO of Pacific Investment Management Company, stated at the 2026 International Financial Leaders Investment Summit held in Hong Kong on Tuesday: "At some point, the market will inevitably experience a downward adjustment, and by then, some problems will come to light."

The Drabowicz of Indosuez Wealth Management indicates: 'We have gone through stages of market fervor, reality checks, and periods of doubt, and we are currently in that phase of doubt. The market is concerned about excessive capital expenditure and the continuous deterioration of free cash flow. However, we believe that in the coming quarters, companies will gradually convert their capital investments into actual revenue and drive a recovery in free cash flow.'

Contradictory signals in the US-Iran situation

Brent crude oil prices have fallen below $106 per barrel, and traders are assessing the possibility of a peace agreement between the United States and Iran. Since this week, international oil prices have experienced sharp fluctuations due to contradictory signals sent by the US and Iran regarding the end of the Middle East war.

A U.S. official confirmed to Reuters on Monday that the U.S. military launched an attack on Iran's Geshem Island in the Strait of Hormuz, confirming previous reports.

Just hours before the news of the attack broke, U.S. President Donald Trump stated that it was "possible to reach an agreement to end the war." Meanwhile, Qatari mediators also went to Tehran to hold talks with Iranian Foreign Minister Mohammad Javad Zarif regarding a potential U.S.-Iranian agreement.

Lis indicates: "I believe that at present, it is not possible to form a highly confident judgment about future trends based solely on the latest developments in the Iranian situation. I think that more investors should adopt the same attitude as well."

U.S. employment market data kicks off the season

Before the release of the latest job vacancy report, the prices of U.S. Treasury bonds remained relatively stable. This report will mark the beginning of a series of U.S. employment market data releases this week. The yield on 10-year U.S. Treasury bonds rose by 1.2 basis points to 4.9064%.

The trend of the US dollar remains stable, with the US Dollar Index, which measures the exchange rate of the US dollar against a basket of major currencies, falling slightly to 101.69. Previously, on Monday, the index hit a one-month low.

Chase Bank's co-head of foreign exchange research, Steve Englander, stated that if the Republican Party unexpectedly wins control of both the Senate and the House at the same time, it could drive up U.S. Treasury yields and the value of the dollar.

Gold has resumed its previous downward trend, trading around $3,900. KCM Trade Chief Market Analyst Tim Waterer stated: "As oil prices rebound, the market risk premium has risen again, which to some extent limits the momentum of gold's recovery. To truly reverse the current situation, gold prices may need to strongly break through the $4,000 mark."

Focus on Individual Stocks

Life sciences company Revvity has raised its earnings per share guidance for the whole year from the previous range of $5.30-5.40 to $5.40-5.45. Driven by this news, the stock price rose by 7%.

After Pfizer announced its third-quarter financial results, the stock price remained relatively stable. Excluding special items, Pfizer reported earnings of 87 cents per share and revenue of $16.58 billion. Analysts surveyed by Reuters ( LSEG ) expected earnings of 73 cents per share and revenue of $15.87 billion.

Zebra Technologies, a company that manufactures barcode scanners and mobile terminal devices for industries such as retail, saw its financial results in the third quarter exceed expectations, yet its stock price still fell by more than 6%. Excluding special items, earnings per share were $4.95, with revenue at $1.61 billion. FactSet Analysts expected earnings per share to be $4.89 and revenue to be $1.57 billion. However, the company provided a guidance for annual free cash flow of not less than $1 billion, which is slightly lower than the market's expectation of $1.02 billion.

Despite third-quarter performance exceeding market expectations, the stock price of Gartner still fell by over 6%; at the same time, the company's full-year profit and revenue forecasts were also better than expected.

Taco Bell's parent company, Yum Brands, reported better third-quarter financial results than analysts expected, with the stock price rising by 1%. Adjusted earnings per share were $1.56; analysts surveyed by Reuters expected $1.49. Revenue was $2.05 billion, in line with market expectations. The company stated that after the parasite outbreak caused by romaine lettuce, Taco Bell's business has since recovered.

Although Palantir's financial report indicators exceeded Wall Street's expectations, the stock price fell by nearly 8%. The company's U.S. business segment revenue soared by 148% to $984 million, exceeding the $953 million in revenue from its government business. Palantir expects revenue of about $2.65 billion in the fourth quarter and $8.53 billion for the entire year of 2026.

Apple's profit margin guidance for the fourth quarter fell short of expectations, and iPad sales were lower than market forecasts, causing the stock price to drop by nearly 4% before trading began.