By Johann M Cherian
(Reuters) - Wall Street is anticipating a lower open on Tuesday as investors await a series of economic data reports that could influence the Federal Reserve's monetary policy decisions.
The Dow and S&P 500 rebounded from losses earlier in August, closing higher on Friday and marking their fourth consecutive month of gains. This positive trend comes on the back of strong U.S. economic data and easing price pressures.
As the Dow hits a record high and the S&P 500 inches closer to its own milestone, investors are cautious as historical data suggests September is a weak month for the main indexes on average.
Market watchers are closely monitoring the release of the monthly ISM manufacturing survey and upcoming labor market reports, leading up to Friday's non-farm payrolls data for August. July's report hinted at a slowdown, sparking a global selloff in riskier assets.
The Federal Reserve's meeting later this month will be a key event, with Chair Jerome Powell indicating possible policy adjustments. The market expects a 25-basis point interest rate cut with a 67% probability, while a larger 50 bps reduction stands at 33%.
At 08:36 a.m. ET, Dow E-minis were down 208 points, S&P 500 E-minis were down 27.75 points, and Nasdaq E-minis were down 121.25 points.
Rate-sensitive chip stocks like Nvidia, Broadcom, and Advanced Micro Devices led premarket declines. Tesla saw a 1.1% increase after reports of new car variants, while Boeing dropped 3.7% after a downgrade. Unity Software surged 7% following an upgrade.
Political concerns weighed on U.S. Steel, which dropped 4.4%, while Southwest Airlines rose 2.3% amid investor activism.
Analysis:
Investors are treading cautiously as economic data reports and the Federal Reserve's upcoming meeting could impact market sentiment. Key indicators like the ISM manufacturing survey and non-farm payrolls data will provide insights into the health of the economy and potential policy adjustments.
Rate cuts and geopolitical factors are influencing market movements, with certain sectors like chip stocks and aerospace companies experiencing volatility. Investors should closely monitor these developments to make informed decisions about their portfolios.
