(Reuters) – U.S. stock futures were mixed on Monday, as investors awaited key corporate results, particularly from Nvidia (NASDAQ:), following significant declines on Wall Street the previous week.
Rising expectations the Federal Reserve will slow its pace of rate cuts and uncertainty over the impact of U.S. President-elect Donald Trump’s cabinet appointments saw indexes slump on Friday.
The and the Nasdaq pulled back from record highs, seeing their worst weekly losses in more than two months.
Results from AI-chip heavyweight Nvidia, which reports third-quarter earnings on Wednesday, will be crucial, as investors assess whether the AI-optimism responsible for much of markets’ tech-driven rally can continue.
Nvidia fell 2.7% in premarket trading. Its revenue is forecast to jump more than 80% to $33 billion, according to LSEG data, and the company is expected to post a net income of $18.4 billion.
“Given that its (Nvidia’s) more recent earnings ‘beats’ have been dwindling in size, this report will have to beat estimates more than comfortably, especially with broader valuations looking rather lofty and bond yields turning back higher after a brief respite,” said Marc Ostwald, chief economist and global strategist at ADM Investor Services International.
Other megacaps edged higher, with gaining ground after the index fell for five consecutive sessions. Alphabet (NASDAQ:) rose 0.3%, Amazon.com (NASDAQ:) was up 0.8% while Tesla (NASDAQ:) soared 8.1%.
Earnings from major retailers including Walmart (NYSE:), Lowe’s Companies (NYSE:) and Target (NYSE:) this week will also be scrutinized to gauge the strength of the U.S. consumer as the key holiday shopping season is set to begin.
At 5:35 a.m. ET, Dow E-minis were down 82 points, or 0.19%, S&P 500 E-minis were up 4.25 points, or 0.07%, and E-minis were up 84 points, or 0.41%.
Stock indexes have lost some of the sharp gains made in the wake of Trump’s decisive presidential election win, as optimism over the Republican’s potentially pro-business stance has given way to focus on the inflationary impact of his policies and the outlook for the U.S. Federal Reserve’s interest-rate path.
Chicago Fed President Austan Goolsbee is expected to speak on the day, the first of several central bank officials slated this week. Their comments will be followed closely after Chair Jerome Powell said the Fed was in no hurry to cut rates.
Traders are pricing in a 38% chance the Fed will keep rates on hold in December, according to the CME FedWatch.
Still, Wall Street remains fairly well placed heading into the year-end. The benchmark index has gained nearly 3% in November and 23% year-to-date as solid economic data, the presidential election and broadly upbeat earnings have propelled equities to record highs.
