The US thematic baskets are experiencing a reversal in trade, with the broader market down 15 basis points. The iShares MSCI USA IWM and Invesco QQQ ETFs are on track for their worst session of the year, down 1.7%. Meanwhile, the UBS US 7 ETF (UBXXMAG7) is a big winner, up 1.4%, ahead of earnings from Apple, Microsoft, Meta, and Tesla next week.

AI semiconductors are higher by 80 basis points on positive headlines about China’s tech firms preparing orders for NVIDIA’s H200 chips. However, excluding AI, the sector is weak, down 3.2%, after a disappointing outlook from Intel due to supply issues. The stock is down 16% on Friday, fully reversing its earlier rally.

Iran has returned to focus as President Trump’s attention shifts from Greenland to Iran, with reports of a “big flotilla” from the US navy heading in its direction. Energy and materials sectors are gaining, up 1.1%, on higher oil prices. However, defense prime contractors are lagging, down 30 basis points.

Looking ahead to the week, earnings highlights include cyclical bellwether Caterpillar, AI power proxy GE Ventures, and AI adoption darling Charter Communications. Macro events include the Federal Open Market Committee meeting, Producer Price Index, and Conference Board Consumer Confidence Index.