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slump in chipmakers on concerns over weak demand and a slide in
megacap growth stocks due to rising Treasury yields had driven
the S&P 500, the Nasdaq and the Dow to their worst single-day
fall on Friday since Aug. 24, dropping between 0.8% and 1.5%.
Traders largely expect the Fed to keep rates unchanged at 5.25%
to 5.5% during its meeting on Wednesday, while their odds for
another pause in November stand at 69%, according to the CME
FedWatch Tool.
A slew of recent hotter-than-expected economic data has eased
recession concerns without raising fears of a September rate
hike. However, a jump in energy prices has emerged as a threat
to inflation that still remains above the Fed's 2% target.
"Further rate hikes would risk sending the economy into a hard
landing," said Thomas Simons, U.S. economist at Jefferies.
"Instead, the Fed can look to a strategy of maintaining current
policy rates for a long time as the best way to administer
restrictive monetary policy to the economy."
Goldman Sachs, much like other big investors such as J.P. Morgan
Asset Management and Janus Henderson Investors, anticipates the
central bank to lift its economic growth projections this week.
It also expects rates to have peaked.
The Bank of England and the Bank of Japan will also make their
monetary policy decisions this week.
At 6:38 a.m. ET, Dow e-minis were up 31 points, or 0.09%, S&P
500 e-minis were up 5.25 points, or 0.12%, and Nasdaq 100
e-minis were up 23 points, or 0.15%.
Micron Technology rebounded 2.9% in premarket trading, following
Friday's rout, after Deutsche Bank upgraded its rating on the
stock to "buy" from "hold".
Asset management firm Blackstone Inc and vacation rentals
platform Airbnb, which are set to join the S&P 500 before the
bell on Monday, were down 0.5% and 0.1%, respectively.
L3Harris Technologies rose 1.8% after Wells Fargo upgraded the
aerospace and defense firm to "overweight" from "equal-weight".
(Reporting by Ankika Biswas and Shristi Achar A in Bengaluru;
Editing by Savio D'Souza and Vinay Dwivedi)
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