US stock futures fall as the commodities crisis roils markets

U.S. stock index futures fell on Monday as a violent sell-off in precious metals unsettled investors at the start of a week of corporate earnings and key economic data.Gold fell as much as 6% and silver fell 10% as commodity exchange CME Group increased margin requirements for the precious metals following a historic drop on Friday. The rout spread across the markets as leveraged investors were forced to unwind their positions to meet margin calls.

U.S. quotes for gold and silver miners fell in premarket trading. Newmont fell 2.2%, while Barrick Mining and Kinross Gold fell 2.8% and 3.2% respectively.Hecla Mining and Coeur Mining each fell more than 2.7%.

The selloff in metals intensified last week after U.S. President Donald Trump nominated Kevin Warsh as the next Federal Reserve chairman to replace Jerome Powell in May, a move that investors largely saw as aggressive.

Energy company shares fell as oil prices fell 5% after Trump said Iran was in “serious discussions” with Washington, signaling de-escalation and easing concerns about supply disruption. Exxon Mobil and Chevron each fell more than 1.5%.

At 5:29 a.m. ET, the Dow E-minis were down 117 points, or 0.24%, the S&P 500 E-minis were down 41 points, or 0.59%, and the Nasdaq 100 E-minis were down 222 points, or 0.86%. Two-week high after last week’s choppy period, driven by mixed mega-cap gains and increased policy uncertainty following Trump’s choice of Warsh.

Tech megacaps fell in premarket trading, with Nvidia and Tesla down nearly 2% each, while Meta and Alphabet lost 1.4% and 0.9%, respectively.

Microsoft and Amazon each lost more than 0.8%.

Investors are in for another tough week of tech earnings, with 128 of the S&P 500 companies expected to report results, including Alphabet, Amazon and AMD.

The market reaction to last week’s technology results underlined the declining tolerance for expensive investment plans unless companies can demonstrate accelerating growth.

Microsoft shares had their “worst week since March 2020” on Friday after cloud revenues disappointed. This raised questions about whether the industry’s multibillion-dollar investments in artificial intelligence will generate meaningful returns.

Oracle fell 3.7% after the company said it expects to raise $45 billion to $50 billion in debt and equity this year.

The US entered a brief shutdown on Saturday after Congress failed to pass a deal to keep many operations funded.

Economic data this week will provide several checkpoints on the health of the U.S. economy.

Manufacturing PMI data for January is due later on Monday, followed by S&P Global’s composite PMI on Wednesday. Labor market indicators will take center stage later this week with JOLTS, unemployment claims and Friday’s nonfarm payrolls report.