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technology-fueled rally led the S&P 500 and the Nasdaq to
register their highest closing level in over three months on
Monday, as investors continued to bet that the Fed was at the
end of its rate hiking cycle.
Big Tech stocks, which have powered most of the S&P 500's gains
this year, now face an important test with Nvidia due to report
third-quarter results after markets close.
The chip designer is expected to deliver yet another blockbuster
revenue forecast but the real focus will be on the impact of
widening U.S. curbs on sales of its high-end chips to China.
"The market is expecting a large pick-up in revenue growth in
Q3, with expectations of an even bigger number for Q4," said
Stuart Cole, head macro economist at Equiti Capital.
However, given potential headwinds such as a slowdown in China,
the company's 2024 guidance could be key for the stock's
performance going forward, Cole added.
Shares of Nvidia edged up 0.2% in premarket trading while other
megacap stocks were mixed.
Before the quarterly report, minutes of the Fed's November
meeting are likely to offer more cues on the monetary policy
path after evidence of slowing inflation boosted expectations
that U.S. interest rates had peaked. The minutes are due to be
released at 1400 ET (1900 GMT).
Traders have fully priced in the probability that the Fed will
hold interest rates steady in December, with 28% betting on the
likelihood that the central bank will deliver a rate cut as soon
as March, according to the CME Group's Fedwatch tool.
This week is light in terms of economic data, with a report on
existing home sales due later in the day. Trading volumes are
also expected to be thin ahead of the Thanksgiving holiday.
Retailers Lowe's and Kohl's are among companies reporting
quarterly results before the opening bell.
At 5:13 a.m. ET, Dow e-minis were down 51 points, or 0.14%, S&P
500 e-minis were down 4.75 points, or 0.1%, and Nasdaq 100
e-minis were down 4 points, or 0.02%.
Among other stocks, U.S.-listed shares of Baidu gained 2% as
China's biggest internet search engine provider's third-quarter
revenue beat estimates.
(Reporting by Amruta Khandekar; additional reporting by Ankika
Biswas; Editing by Maju Samuel)
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