Futures struggle for direction as markets await inflation data

By Purvi Agarwal and Shashwat Chauhan

(Reuters) -Futures tied to Wall Street's main indexes were subdued on Tuesday as investors exercised caution ahead of a crucial inflation report this week that could influence the Federal Reserve's upcoming interest rate verdict.

A November reading of the consumer price index (CPI), due on Wednesday, is among the last major datasets ahead of the Fed's Dec. 17-18 meeting. The report is expected to show a slight increase in headline inflation last month.

Trader bets on the Fed delivering another 25 basis point interest rate cut next week stand at over 86%, according to CME's FedWatch Tool. Bets had jumped after Friday's employment report that showed a surge in job growth but also marked an uptick in unemployment.

However, bets indicate the central bank is expected to pause its easing cycle in January, as a host of Fed officials last week hinted at a slower pace of monetary policy easing on the back of a resilient economy.

At 7:00 a.m. ET, Dow E-minis were up 2 points, or 0%, S&P 500 E-minis were up 4.25 points, or 0.07% and Nasdaq 100 E-minis were up 28.5 points, or 0.13%.

Wall Street's main indexes closed lower on Monday, pressured by technology stocks whose declines were led by Nvidia (NASDAQ:NVDA ) after the Chinese market regulator launched an antitrust probe into the AI chip giant. Its shares were down 0.5% in premarket trading on Tuesday.

"With most stock indices recording significant gains in November, particularly after Trump's reelection, red sessions like yesterday's are pretty useful in reining in expectations of a perpetual rally," Achilleas Georgolopoulos, market analyst at forex broker XM, wrote in a morning note.

U.S. equities started their year-end journey on a broadly positive note, with the benchmark S&P 500 and the tech-heavy Nasdaq logging gains in their first week, building upon a stellar November after Donald Trump's win in the presidential election.

The president-elect's potential policies on tax cuts and looser regulation in the incoming administration are expected to boost corporate performance.

Most megacap and growth stocks were slightly higher, though Google-parent Alphabet (NASDAQ:GOOGL ) outperformed with an 2.2% advance.

Among other notable movers, Oracle (NYSE:ORCL ) dipped 7.9% after the cloud computing company missed Wall Street estimates for second-quarter results and forecast its third-quarter profit below estimates.



C3.ai (NYSE:AI ) climbed 7.7% after the AI software maker raised its forecast for fiscal year 2025 revenue, while software firm MongoDB (NASDAQ:MDB ) slipped 6.3% despite raising its forecast for annual results.

Pinterest (NYSE:PINS ) slipped 2.3% after Piper Sandler downgraded its rating on the image-sharing platform to "neutral" from "overweight", while eBay (NASDAQ:EBAY ) eased 3.7% as Jefferies lowered the e-commerce firm's rating to "underperform" from "hold".

Source: Investing.com