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Stronger-than-expected inflation figures last week have prompted
investors to rethink when and by how much policymakers will
lower rates this year, with traders pulling back bets of a June
rate cut to 57% from 71% last Monday, according to the CME
FedWatch Tool.
Nevertheless, led by optimism around artificial intelligence
(AI), Wall Street hit fresh all-time highs in March, before
pulling back some gains last week.
A hawkish tilt by the Fed in its policy meeting that concludes
on Wednesday could further pressure the high-flying shares.
"While the recent pullback in tech stocks may follow fears that
the market has run too far and portfolios are too concentrated,
we believe investors can find compelling diversification
opportunities through the next AI leaders," said Mark Haefele,
chief investment officer at UBS Global Wealth Management.
Investors eyed chipmaker Nvidia's GTC developer conference from
March 18 to 21, which will be parsed for AI-related
announcements. Shares of the AI giant rose 2.1% in premarket
trading.
Peers such as Micron Technology and Advanced Micro Devices added
2.6% and 1.2%, respectively.
At 5:30 a.m. ET, Dow e-minis were down 6 points, or 0.02%, S&P
500 e-minis were up 17.5 points, or 0.34%, and Nasdaq 100
e-minis were up 117.5 points, or 0.65%.
Most megacap growth and technology shares also advanced in
trading before the bell.
Alphabet gained 3.1% after a media report that Apple is in talks
to build Google's Gemini AI engine into the iPhone.
Tesla rose 3.3% after the electric carmaker said it would
increase the price of its Model Y EVs in some European countries
on March 22, by approximately 2,000 euros ($2,177) or its
equivalent in local currencies.
U.S.-listed shares of Xpeng climbed 7.0% on plans to launch a
cheaper EV brand amid fierce price competition.
Meanwhile, Boeing shed 1.1% after a media report that a Federal
grand jury in Seattle issued a subpoena to the planemaker over
the Jan. 5 midair blowout.
(Reporting by Bansari Mayur Kamdar in Bengaluru; Editing by
Pooja Desai)
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