US Stock Futures Steady as Fed and Inflation Take Center Stage

U.S. stock index futures showed minimal movement in evening trading on Tuesday, as investors hesitated to make significant trades ahead of more insights on interest rates from the Federal Reserve and important inflation data.

Futures stabilized following a positive session driven by technology stocks on Wall Street, although most other sectors lagged behind. Investor sentiment remained cautious due to ongoing tensions in the Middle East, and enthusiasm over new stimulus measures in China diminished.

S&P 500 Futures dipped slightly to 5,798.25 points, while Nasdaq 100 Futures fell 0.1% to 20,286.50 points by 19:11 ET. Dow Jones Futures remained steady at 42,378.0 points.

Markets are now keenly awaiting updates on U.S. interest rates, as doubts grow about the Fed’s plans for further rate cuts in the near future. The minutes from the Fed’s September meeting are scheduled for release on Wednesday, and several Fed officials are also expected to speak.

Strong payroll data released the previous week raised questions about the Fed’s necessity to continue aggressive rate cuts. Traders are currently pricing in an 81.1% likelihood of a 25 basis point reduction in November, while the chance of rates staying unchanged is estimated at 18.9%. The Fed had decreased rates by 50 bps in September, indicating that future cuts will still largely rely on inflation trends and the labor market.

Consumer price index inflation data is anticipated on Thursday, which will likely influence the Fed’s perspective.

Wall Street indices experienced an uptick on Tuesday, largely driven by technology stocks, with NVIDIA Corporation notably rising 4%, although the stock dipped during after-hours trading.

The S&P 500 increased by 1% to 5,751.13 points, while the NASDAQ Composite surged 1.4% to 18,182.34 points, recovering most of Monday’s losses. The Dow Jones Industrial Average rose by 0.3% to 42,080.37 points.

Attention this week is also on the commencement of the third-quarter earnings season, with several major banks set to announce their earnings on Friday. Markets will be watching closely to see if corporate profits can withstand pressure from high interest rates and persistent inflation.