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The
tech-heavy Nasdaq led the advance among Wall Street's major
indexes on Monday, boosted by a jump in Tesla shares on optimism
around artificial intelligence following a Morgan Stanley rating
upgrade.
While Tesla eased 0.5% in premarket trading on Tuesday, other
growth names including Amazon.com and Microsoft also lost steam
to drop 0.6% each.
Focus now shifts to August consumer prices on Wednesday and
producer prices on Thursday, followed by the Fed's policy
decision on Sept. 20.
A recent uptick in oil prices and resilient economic data have
fueled concerns over stubborn inflation, blurring a possible end
to U.S. rate hikes.
Traders still see a 93% chance of rates remaining at the current
levels in September and a 58% likelihood of a pause in November,
as per the CME FedWatch Tool.
Investors will also monitor the European Central Bank's policy
decision on Thursday.
"We are in the dovish camp for all three central banks - Fed,
ECB and the BoE," said Mohit Kumar, chief European economist at
Jefferies.
"Our view is for a pause from both the Fed and the ECB, and
believe that slowing data will remove the need for any further
hikes."
Fed officials are now in a blackout period, during which they
usually do not make public comments.
Investors will also be mindful of any indications of a possible
so-called soft landing for the U.S. economy, already bruised by
the Fed's aggressive monetary policy tightening.
At 5:08 a.m. ET, Dow e-minis were down 56 points, or 0.16%, S&P
500 e-minis were down 10.75 points, or 0.24%, and Nasdaq 100
e-minis were down 42.75 points, or 0.28%.
Cloud-services provider Oracle shed 9.3% after projecting
current-quarter revenue below targets and narrowly missing
first-quarter expectations.
United Parcel Service slipped 1.2% as its new contract covering
some 340,000 Teamsters-represented U.S. workers would increase
wage and benefit costs at a 3.3% compound annual growth rate.
Meanwhile, WestRock jumped 7% on agreeing to merge with Europe's
Smurfit Kappa to create the world's largest listed paper and
packaging company worth nearly $20 billion.
(Reporting by Ankika Biswas in Bengaluru; Editing by Arun Koyyur)
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