Futures drift lower as Nvidia results, Fed minutes loom
(Reuters) — U.S. stock index futures inched lower on Tuesday as investors stayed on the sidelines ahead of artificial intelligence chip leader Nvidia (NASDAQ:NVDA)'s quarterly report and the release of the Federal Reserve's meeting minutes.
A technology-fueled rally led the S&P 500 and the Nasdaq to register their highest closing level in over three months on Monday, as investors continued to bet that the Fed was at the end of its rate hiking cycle.
Big Tech stocks, which have powered most of the S&P 500's gains this year, now face an important test with Nvidia due to report third-quarter results after markets close.
The chip designer is expected to deliver yet another blockbuster revenue forecast but the real focus will be on the impact of widening U.S. curbs on sales of its high-end chips to China.
«The market is expecting a large pick-up in revenue growth in Q3, with expectations of an even bigger number for Q4,» said Stuart Cole, head macro economist at Equiti Capital.
However, given potential headwinds such as a slowdown in China, the company's 2024 guidance could be key for the stock's performance going forward, Cole added.
Shares of Nvidia edged up 0.2% in premarket trading while other megacap stocks were mixed.
Before the quarterly report, minutes of the Fed's November meeting are likely to offer more cues on the monetary policy path after evidence of slowing inflation boosted expectations that U.S. interest rates had peaked. The minutes are due to be released at 1400 ET (1900 GMT).
Traders have fully priced in the probability that the Fed will hold interest rates steady in December, with 28% betting on the likelihood that the central bank will deliver a rate cut as soon as March, according to the CME Group's
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