Written by Ankika Biswas and Lisa Pauline Matkal
(Reuters) – Nasdaq futures outperformed their counterparts on Tuesday, with shares of Nvidia and other artificial intelligence-related stocks rising after painful selling, while investors awaited more signs on the path of monetary policy based on statements by US Federal Reserve officials and new economic data this. the week.
AI chip maker Nvidia advanced 2.5% in premarket after losing nearly 13% and $430 billion in market cap in the past three trading days.
Peers Micron Technology, Broadcom and Qualcomm rose more than 1% each, while AI-optimized server maker Super Micro Computer rose 1.7%.
The Nasdaq technology index fell more than 1% on Monday in its biggest single-day decline since late April, as investors pulled out of artificial intelligence-related stocks in favor of other sectors.
At the start of the week, investors bought into sectors including utilities and energy that have underperformed technology and related stocks this year, causing the Dow to hit a one-month high on Monday. Futures tracking the blue-chip stock index fell on Tuesday.
Technology and other growth stocks have pushed the S&P 500 and Nasdaq to record highs this year, but the value-focused Dow Jones still lags significantly behind other indexes, causing some to raise concerns about the sustainability of the stocks’ strength.
“The question investors need to ask now is whether the sell-off has gone far enough that the stock (Nvidia) is in correction territory, or if this is a structural shift down that will weigh on the major US indices and allow other regional indices to play catch-up,” said Kathleen Brooks, director of research at XTB.
Data on the Personal Consumption Expenditures (PCE) price index – the Fed’s preferred measure of inflation – on Friday is at the top of the watch list, while investors will also be watching consumer confidence data during the day.
Fed Governor Michelle Bowman said inflation remains high, and a fixed interest rate is needed “for some time.” Lisa Cook, a voting member of the Federal Open Market Committee, is also scheduled to speak on Tuesday.
Market participants see 61% odds of a 25 basis point rate cut in September, and are eyeing two cuts by the end of the year, according to FedWatch data from LSEG.
A slew of quarterly corporate earnings are also scheduled for today, with cruise company Carnival Corp scheduled to announce its market opening date and parcel delivery giant FedEx set to report after the bell.
At 7:21 a.m. EDT, Dow e-minis were down 31 points, or 0.08%, S&P 500 e-minis were up 11.75 points, or 0.21%, and Nasdaq 100 e-minis were up 96.25 points, or 0.49%.
Among the main pre-market movers, Spirit AeroSystems fell 3.4%. Boeing has offered to acquire the fuselage maker in a deal financed mostly by stock that values its key supplier at about $35 per share, a report showed. Boeing shares fell 1.1%.
Trump Media and Technology Group shares rose 7.8% and is set to continue the strong gains it achieved on Monday. The company announced that it expects proceeds of $69.4 million from the exercise of cash guarantees.
(Reporting by Ankika Biswas and Lisa Matkal in Bengaluru; Editing by Shaunak Dasgupta and Maju Samuel)
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