Investors are buying on Monday despite fear the AI trade nightmare scenario is far from over

This is CNBC's Morning Squawk newsletter. Subscribe here to receive future editions in your inbox.

Hello, this is Leonie Kidd, and this is my first edition of Morning Squawk.

It's always nice to start the week on a positive note, but the pop in futures after AI's nightmare week comes with a note of caution. While some investors are choosing to see the buying opportunity, others are taking these gains and still rotating out of tech. 

Happening now: Buying the dip

The buyers are ready to get back into technology stocks, with futures indicating the Nasdaq will catch the biggest bid at today's open. The move looks set to regain only some of the losses from last week, which saw cracks emerge in the AI boom, sending the tech-heavy index down 4.5%. 

The glass half full: In a note on Sunday, Dan Ives, Partner at Yorkville Ives, said he views this "white-knuckle drawdown as a golden buying opportunity."

Contrary to the contrarian: But BTIG is telling investors to use any rebound in semiconductor stocks to reduce exposure, warning, "where there is smoke, there is fire." 

Why it matters: The Cboe Volatility Index hit its highest levels since June on Friday, a sign that fear is growing on Wall Street that a bigger correction could be ahead. Let's see if today's bounce has enough conviction to assuage that concern.

Stock Chart IconStock chart icon

The CBOE Volatility Index hit its highest level since June 2026 on Friday.

Mixed signals from China: China's third-quarter GDP data surprised to the upside, lending support to gains across Asian equity markets, but shares in China's memory chipmaker CXMT fell despite its swing to profitability.  

• CNBC's Arjun Kharpal reported on how competition and increased supply from CXMT have spooked the wider memory chip space. 

Big movers: Comeback kings

CoreWeave is set to open higher by around 3%, but that doesn't put much of a dent in the 25% drop from last week. It's a similar picture for Nebius which is also seen opening higher after losing the same amount as its neocloud peer.