By Ankika Biswas and Shristi Achar A
(Reuters) — Wall Street's main indexes were poised to open lower on Tuesday after starting the week on a strong footing, as investors awaited key inflation readings for clues on the Federal Reserve's interest-rate path.
The tech-heavy Nasdaq led the advance among Wall Street's major indexes on Monday, boosted by a jump in Tesla (NASDAQ:TSLA) shares on optimism around artificial intelligence following a rating upgrade by Morgan Stanley.
Tesla fell 0.9% before the bell on Tuesday, while other megacap growth names including Amazon.com (NASDAQ:AMZN) and Microsoft (NASDAQ:MSFT) dropped 0.6% and 0.7%, respectively.
Investors await August consumer prices data, due on Wednesday, and producer prices reading scheduled on Thursday, followed by the Fed's policy decision on Sept. 20.
A recent uptick in oil prices and strong economic data have fueled concerns over stubborn inflation, clouding the outlook for an end to U.S. monetary policy tightening.
Investors will also monitor the European Central Bank's policy decision on Thursday, where it is seen holding rates after nine consecutive hikes.
«People are a little bit worried about energy prices picking up pretty aggressively in recent weeks and that creates some concerns as we look forward to November,» said Thomas Hayes, chairman at Great Hill Capital LLC.
«It seems regardless that Fed will skip in September, but the inflation data that we get between now and November is critical and the market is at the point where anymore tightening could be a bit excessive and a major headwind.»
Traders see a 93% chance of rates remaining at the current levels in September and a near 53% likelihood of a pause in November, as per the CME FedWatch Tool.
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