Futures edge higher as tech stocks bounce

[July 31, 2018]   By Amy Caren Daniel

(Reuters) - U.S. stock index futures edged higher on Tuesday, with technology stocks looking to bounce back after a widespread sell-off in the earlier session on rising concerns about the future growth of high-flying companies.

The technology sector, which had led the equity market to record highs, has lost more than 5 percent in the past three days after lackluster earnings from Netflix, Facebook and Twitter. The Nasdaq posted its third consecutive loss of more than 1 percent for the first time in three years on Monday.

Shares of Facebook were marginally lower in premarket trading, while others in the so-called FAANG group were higher. Amazon.com, Netflix and Google parent Alphabet were up between 0.24 and 0.57 percent.

Investors are now pinning their hopes on Apple, the last of the FAANGs to report results, which is due after the bell. The stock was up 0.4 percent.

The jitters about the future of technology stocks comes as data continues to show the economy is growing at a healthy clip.

The personal consumption expenditures (PCE) index, the Federal Reserve's preferred measure of inflation, likely rose 2 percent in June from a year earlier, a Commerce Department report at 8:30 a.m. ET is expected to show.

That would mean two straight months that inflation has hit the target rate of the Fed, which starts its two-day meeting later in the day. The central bank is expected to keep interest rates unchanged on Wednesday, but solid economic growth and rising inflation is likely keep it on track for another two hikes this year.
 

Traders work on the floor of the New York Stock Exchange shortly after the opening bell in New York, U.S., July 27, 2018. REUTERS/Lucas Jackson

At 7:30 a.m. ET, Dow e-minis were up 30 points, or 0.12 percent. S&P 500 e-minis were up 7 points, or 0.25 percent and Nasdaq 100 e-minis were up 18.75 points, or 0.26 percent.

Twitter rose 1.1 percent after brokerage Nomura upgraded the stock.

Pfizer's shares dipped 0.4 percent after the drugmaker lowered its full-year revenue forecast due to a strong dollar.

Procter & Gamble dropped 2.6 percent after the consumer goods company reported lower-than-expected quarterly revenue.

(Reporting by Amy Caren Daniel in Bengaluru; Editing by Shounak Dasgupta)

[© 2018 Thomson Reuters. All rights reserved.]

Copyright 2018 Reuters. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.  Thompson Reuters is solely responsible for this content.