Stock futures slip on tech selloff; Yellen in focus

[June 27, 2017]  By Tanya Agrawal

(Reuters) - U.S. stock index futures were lower on Tuesday as a selloff in technology shares continued, while investors awaited clues on interest rate hikes from Federal Reserve Chair Janet Yellen's talk in London.

The tech sector has been under pressure over concerns about stretched valuations, with investors shifting to high-dividend paying defensive sectors such as utilities in a rising interest rate environment.

Yellen is scheduled to take part in a discussion on global economic issues in London at 1 p.m. ET (1500 GMT). Investors expect Yellen to offer more insight into the state of the U.S. economy, which would support the Fed's forecast of a rate hike this year.

Fed officials have signaled that they would look through a slowdown in inflation and continue on their current path for hikes. But investors are skeptical and market pricing shows only a 40 percent chance of a rate hike at the Fed's December meeting.

Minneapolis Fed head Neel Kashkari and Philadelphia Fed chief Patrick Harker are also scheduled to speak later in the day.

Investors have been anxious about a patch of recent weak economic data, while a steep fall in oil prices and a flattening yield curve have added to low-inflation concerns.

Data on Monday showed new orders for key U.S.-made capital goods unexpectedly fell in May and shipments also declined.

Traders work on the floor of the New York Stock Exchange shortly after the closing bell in New York, U.S., June 23, 2017. REUTERS/Lucas Jackson

The U.S. Conference Board is expected to show a drop in its consumer confidence index for the month of June to 116.0, after slipping to 117.9 in May. The data is expected at 10 a.m. ET.

Oil prices rose for a fourth consecutive session, boosted by a weaker dollar and investors covering short positions, but worries over persistent oversupply capped gains. [O/R]

Alphabet fell 1.1 percent to $962 in premarket trading after EU antitrust regulators hit the tech giant with a record $2.7 billion fine.

Sprint rose 7.4 percent to $8.60 after sources said the wireless carrier is in talks with Charter Communications and Comcast about a partnership to boost the companies' wireless offerings. Comcast was down 1.5 percent at $39, while Charter was little changed at $332.65.

General Motors slipped 0.8 percent to $34.24 after the automaker lowered its outlook for new sales in 2017.

(Reporting by Tanya Agrawal; Editing by Anil D'Silva)

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