Futures drop as yields rise ahead of July retail sales data
By Amruta Khandekar and Shristi Achar A
(Reuters) — U.S. stock index futures fell on Tuesday as government bond yields hit fresh highs ahead of July retail sales data that could offer clues on the Federal Reserve's interest rate path.
The Commerce Department's report due at 0830 a.m. ET (1230 GMT) is expected to show retail sales rose 0.4% last month after climbing 0.2% in June, likely adding to evidence that the U.S. economy remains on a strong footing.
«All eyes will be on the U.S. retail sales figures later today which could add another piece to the puzzle that determines whether the Fed hikes one more time in 2023 or not,» Lukman Otunuga, senior research analyst at FXTM, said in a note.
«Should price pressures continue to ease and U.S. economic data show signs of weakness, this may eliminate the odds of another hike, especially when factoring in the Fed's current data dependence stance.»
Rising Treasury yields have pressured equities after hotter-than-expected producer prices data last week stoked concerns the Fed could keep rates higher for longer than previously anticipated.
The S&P 500 and the Nasdaq rose on Monday as Nvidia (NASDAQ:NVDA) led gains among megacap growth stocks following a bullish note from Morgan Stanley (NYSE:MS) ahead of the chip designer's earnings next week.
Nvidia was an outlier among major technology and growth stocks on Tuesday, rising 1.1% in premarket trading after UBS and Wells Fargo (NYSE:WFC) lifted their price target on the stock.
Shares of Apple (NASDAQ:AAPL), Amazon.com (NASDAQ:AMZN) and Alphabet (NASDAQ:GOOGL) fell between 0.5% and 0.7%, with the yield on the 10-year Treasury note hitting a fresh nine-month high, last up at 4.23%.
Tesla (NASDAQ:TSLA) slipped 1.3% after the electric
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