US stock futures climbed on Tuesday after confidence in artificial intelligence and falling oil prices spurred a rally on Wall Street.

Futures on the Nasdaq-100 (NQ=F) edged higher by 0.1% after the tech-heavy Nasdaq Composite touched a record high the day before. S&P 500 futures (ES=F) were in the green, while those on the Dow Jones Industrial Average (YM=F) rose 0.3%.

Stocks kicked off the week with strong gains as US and Chinese officials wrapped up talks ahead of a capstone meeting between President Trump and Chinese leader Xi Jinping. Treasury Secretary Scott Bessent called the preliminary talks "very successful," lifting hopes of cooperation on artificial intelligence.

Oil prices fell on Tuesday amid reports that Iran may reopen the Strait of Hormuz within seven days if the US takes steps to ease military pressure. Brent crude futures (BZ=F) fell over 2%, while WTI (CL=F) dropped 3%.

Meta (META) shares, which popped 11% on Monday, lifted the "Magnificent Seven" stocks after the company's Muse AI agent app hit the top spot in the App Store, sending a bullish signal about chip demand.

The US rally in tech stocks spilled over into Asian markets, with the Nikkei (^N225) and KOSPI (^KS11) indexes gaining on Tuesday. Although oil prices ticked up again, improved oil flows through the Strait of Hormuz have kept the critical product below $100 per barrel.

KB Home (KBH) and AutoZone (AZO) report earnings on Tuesday amid a light week for economic data and earnings.

The "Magnificent Seven" tech group — consisting of Apple (AAPL), Alphabet (GOOGL, GOOG), Microsoft (MSFT), Amazon (AMZN), Meta (META), Tesla (TSLA), and Nvidia (NVDA) — is back in the driver's seat.

The Roundhill Magnificent Seven ETF (MAGS) hit an all-time high on Monday. A resurgence in investor appetite for Big Tech lifted all the Magnificent Seven stocks into the green, but the gains were largely driven by the 11% surge in Meta shares.

Although concerns about capital expenditures for artificial intelligence remain, part of the appeal may be that tech has gotten cheaper lately, as Yahoo Finance's Brian Sozzi reported. At the same time, forward earnings expectations remain strong.

Still, analysts expect that other parts of the market could create more competition for market leadership.

"The Magnificent 7 are unlikely to disappear as market leaders, but the environment that fueled their outperformance and a narrow market over the last few years is becoming less favorable and more nuanced," Jefferies analysts wrote last week. "Earnings growth is expected to slow, free cash flow remains under pressure from record AI investment, and a growing pipeline of AI/Tech IPOs could create competition for capital."

Economic data: ADP weekly employment change, week ended Sept. 5 (+16,250 previously); Philadelphia Fed non-manufacturing index, September (-10.6 previously); Richmond Fed manufacturing index, September (4 previously); Richmond Fed business conditions, September (-12 previously)

Earnings calendar: THOR Industries (THO), KB Home (KBH)

Catch up on some top stories you might have missed overnight:

Meta stock soars on price target increase, Muse AI downloads

Alibaba unveils AI chip to drive 20GW of data centers by 2032

How a Bangladeshi garment-maker is fighting the Middle East energy crunch

Canada aims to cut time needed for project reviews, and address strikes

Oil rises slightly ahead of potential US-Iran talks

Reuters reports:

Technology stocks powered Asian markets higher on Tuesday as lower oil prices lifted sentiment and investors pinned their hopes on US-Iran talks, while the dollar stood tall on bets that more hikes are needed ‌to rein in inflation.

Attention is also turning to a high-stakes meeting between Donald Trump and Xi Jinping later this week, with ‌investors watching for signs the leaders of the world's two largest economies can prevent a further deterioration in relations.

"The drop in oil ⁠is a big factor," said Nick Twidale, chief market strategist at ATFX Global. "Oil is the main driver and investors are jumping back into AI as has been the pattern this year."

MSCI's broadest index of Asia-Pacific shares outside ⁠Japan rose over 1% in early trading. Tech-heavy South Korean stocks jumped nearly 2% while Taiwan shares were 1.3% higher. Japan markets are closed for a holiday.

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