S&P futures are little changed following another record-setting day for benchmark: Live updates

S&P 500 and Nasdaq futures were little changed after both indices hit fresh records, with S&P futures down 0.1%, Nasdaq 100 futures flat, and Dow futures off 173 points (-0.4%). Risk appetite was supported by a 1.05% rise in the S&P 500 and a 1.64% gain in the Nasdaq on easing Iran ceasefire fears, while 81% of the 87 S&P reporters so far have beaten EPS and 76% have topped revenue estimates. Tesla fell about 2% after-hours on warnings that capex will rise substantially for AI self-driving and robot ambitions, while IBM and ServiceNow dropped 6% and 13% on earnings.

Analysis

The immediate market message is that earnings breadth is still overpowering geopolitics, but the second-order read is more nuanced: leadership is narrowing toward firms with visible AI capex monetization and away from businesses where AI is still a cost center. That is why the post-print reaction in IBM/NOW matters more than the headline index strength — investors are starting to punish any guidance that implies a longer payback period on AI spending, even if the underlying demand story remains intact.

Tesla's reaction is more interesting than the headline beat because it frames AI/robotics as a margin and capital intensity debate, not just a growth narrative. If capex ramps materially over the next 4-8 quarters, the market will likely re-rate TSLA on free-cash-flow conversion rather than unit growth, which keeps downside open unless management can prove a faster software/compute monetization loop. By contrast, suppliers and industrial beneficiaries of that capex cycle could see a lagged winner profile even if the equity itself stays volatile.

The geopolitical backdrop is not a broad risk-on tailwind so much as a volatility suppressant that can reverse quickly. The market is currently pricing a low-probability escalation path, but any sustained disruption in the Strait of Hormuz would hit transports, airlines, and cyclical industrials first through input-cost and sentiment channels before showing up in macro data; that makes the next few sessions more about factor rotation than outright index direction. PMI prints are the cleanest near-term check on whether this earnings resilience is real demand strength or just inventory/price discipline masking slower end-market growth.

Key Decisions for Investors

• Fade the AI-capex optimism in TSLA via a 30-60 day put spread; downside catalyst is any follow-up commentary confirming elevated capex without near-term margin offset, while upside is capped unless the market re-prices robotics as a nearer-term profit engine.
• Short IBM / long a basket of profitable AI infrastructure enablers over the next 1-2 months; the market is differentiating between AI spend that expands revenue and AI spend that compresses near-term FCF.
• Buy downside protection on AAL into PMI and oil/geopolitical headlines for the next 1-3 weeks; airlines are the fastest beta to a renewed risk-off impulse and any fuel-cost spike or travel demand wobble can reprice the sector quickly.
• Long LMT versus AAL on a 1-2 month horizon as a geopolitical hedge; defense cash flows are less sensitive to macro deceleration than travel/cyclical demand and can outperform if regional tensions stay elevated.
• Stay tactically long SPGI into the PMI release only if positioning remains light; a soft PMI would make this a cleaner quality/data beneficiary than a full-risk equity exposure.