Futures flat with Fed minutes, inflation data in focus; Alphabet dips

By Lisa Pauline Mattackal and Pranav Kashyap

(Reuters) -Futures tracking the Dow and the S&P 500 pointed to a steady open on Wednesday as investors awaited the minutes of the Federal Reserve's latest meeting, while Alphabet (NASDAQ:GOOGL ) shares slipped after the U.S. said it was considering breaking up Google.

Shares of Alphabet were down 0.6% in premarket trading after the U.S. Department of Justice said it may ask a judge to force Google to divest parts of its business, including the Chrome internet browser and Android operating system, to curtail its search monopoly.

Futures tracking the tech-heavy Nasdaq 100 lagged futures for the other two main U.S. indexes.

"(This is) just a reflection of how super-sized Big Tech has become. Any uncertainty there will feature into the rest of the market," said Ben Laidler, head of equity strategy at Bradesco BBI.

Dow E-minis were down 6 points, or 0.01%, S&P 500 E-minis were down 3 points, or 0.05%, and Nasdaq 100 E-minis were down 36.25 points, or 0.18%.

Indexes closed higher on Tuesday after rebounding from Monday's selloff, with technology stocks leading the charge as U.S. Treasury yields eased.

Trading has been choppy this week, with investors adjusting their rate-cut expectations, seeking new catalysts for a clearer market direction. Key inflation data on Thursday and the upcoming third-quarter corporate earnings season are now in focus.

Minutes from the Fed's September meeting, when policymakers kicked off monetary policy easing with a 50-basis-point rate cut, are due at 2:00 p.m. ET.

"We expect the FOMC minutes and tomorrow's CPI to be reassuring and calm these market nerves around the ability of the Fed to keep cutting interest rates," Laidler said.

"Anything in line with consensus will calm markets, which have been second guessing how much the Fed can cut."

Commentary from a number of Fed officials including Philip Jefferson, Thomas Barkin, Raphael Bostic and Mary Daly are also expected through the day.

Investors are overwhelmingly pricing in a 25-basis-point reduction in borrowing costs at the Fed's November meeting, with some now seeing a slight chance the central bank will keep rates on hold, according to the CME FedWatch tool.

Prior to the release of strong employment data last week, markets were leaning towards an outsized 50-bps cut in November.

Among single stocks, Boeing (NYSE:BA ) lost 1.6% after talks between the company and its key manufacturing union broke down, sending a strike into its fourth week, with no sign of resolution.

Shares of Arcadium Lithium soared 30.7% after Rio Tinto (NYSE:RIO ) said it would acquire the miner for $6.7 billion. Rio Tinto's U.S.-listing slipped 1.1%.

U.S.-listed shares of Chinese firms dropped for a second day, tracking a slide in domestic stocks as investors continued to question if China would announce new stimulus measures.



Alibaba (NYSE:BABA ) Group fell 3.2%, PDD Holdings lost 3.7% and JD (NASDAQ:JD ).Com dropped 4.6%. The iShares MSCI China exchange-traded fund lost 3.4%.

Additionally, investors were keeping a watch on the impact from Category 5 Hurricane Milton as well as the escalating conflict in the Middle East.

Source: Investing.com