US Stock Futures Slip as Tech Giants Decline Ahead of Economic Indicators

Investor sentiment wavers as U.S. stock index futures edge lower on Tuesday, anticipating a wave of economic indicators and pivotal events scheduled for the week, notably Federal Reserve Chair Jerome Powell's appearances.

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The recent surge on Wall Street, fueled by AI, takes a breather as attention shifts towards fresh signals regarding the Fed's stance on monetary policy. Concerns arise following February's persistent inflationary trends, dimming hopes for imminent interest rate adjustments.

Despite Monday's fleeting record highs in the benchmark S&P 500, anticipation mounts ahead of Powell's congressional testimonies later this week.

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"In his testimony, Powell is expected to advocate for patience in timing the first rate cut, acknowledging inflation's trajectory while avoiding premature policy adjustments," remarked Ipek Ozkardeskaya, a senior market analyst at Swissquote Bank.

The market eagerly awaits crucial data releases, including February's U.S. services sector performance and January's factory orders, slated for 10:00 a.m. ET. These figures offer insights into the economy's vitality and the trajectory of interest rates.

Additionally, a slew of employment data, culminating in the highly anticipated nonfarm payrolls report, is scheduled for release in the days ahead.

Market sentiment suggests a 65.5% likelihood of a rate cut in June, according to CME Group's FedWatch tool. However, Atlanta Fed President Raphael Bostic's remarks on Monday, citing a robust economy and labor market, temper expectations for near-term rate adjustments.

Investor attention also centers on speeches by various Fed officials, including Vice Chair for Supervision Michael Barr, later in the day.

Meanwhile, notable market movements include Target's premarket surge of 7.7%, propelled by optimistic forecasts for annual comparable sales. Conversely, Apple faces a 1.9% decline following reports of a 24% year-on-year drop in iPhone sales in China.

Tech behemoths like Nvidia and Tesla also witness declines, with the latter halting production at its European Gigafactory due to a suspected arson attack.

As of 6:55 a.m. ET, Dow e-minis slip by 47 points, S&P 500 e-minis by 14.75 points, and Nasdaq 100 e-minis by 113 points.

Additional market movements include a 2% drop in Advanced Micro Devices shares amid reports of regulatory hurdles for its AI chip sales in China. Similarly, Microstrategy experiences a 4.9% decline after announcing a private offering of $600 million in convertible senior notes to fund bitcoin purchases.

Cryptocurrency-linked firms like Riot Platforms and Marathon Digital also falter, reflecting a broader retreat as bitcoin prices soften.

Also Read: US Stock Futures Pause Amidst Federal Reserve Testimony and Jobs Report Anticipation