Stock futures were slightly lower Tuesday after a slide in technology names pressured the S&P 500 and Nasdaq Composite, while the Dow Jones Industrial Average closed at a record high. Futures tied to the Dow Jones Industrial Average and S&P 500 futures climbed both slipped under 0.2%. Nasdaq-100 futures were 0.2% lower. On Monday, the Dow broke with the broader market and reached intraday and closing record highs. Meanwhile, a decline in tech stocks and a gain in less favored segments like energy signaled that investors might be rotating out of one of the market’s key drivers over the past year. Investors are eager to see earnings from top artificial intelligence beneficiary Nvidia on Wednesday. Shares of the semiconductor firm closed more than 2% lower Monday and were marginally higher in after hours trading. Nvidia has become a key bellwether for tech stocks and AI more broadly, and investors will look toward its second-quarter results to gauge the health of the AI trade. Stocks are trying to find stable footing after a brutal start to the month. Investors have grown more optimistic, however, after Federal Reserve Chair Jerome Powell signaled on Friday that the central bank’s next move will be to cut benchmark interest rates. Powell did not specify when, or by how much, interest rates would be reduced. Traders are unanimously forecasting a rate cut at the central bank’s Sept.17-18 policy meeting of at least 25 basis points, according to data from the CME Group’s FedWatch Tool. “It’s going to take time for the cuts to go all over the economy … the market is doing some of the heavy lifting for the Fed, but there’s a lot of question marks,” Allianz chief economic advisor Mohamed El-Erian told CNBC’s “Closing Bell: Overtime” on Monday. Investors will also parse fresh quarterly earnings from retailer Nordstrom after the closing bell Tuesday for insight into the health of consumers. The U.S. 10-year Treasury rose on Tuesday as investors monitored fresh economic data after the Federal Reserve boosted already high expectations for imminent interest rate cuts. The yield on the 10-year Treasury climbed 3 basis points to 3.848%, while the yield on the 2-year Treasury added nearly basis point2 to trade at 3.95%. Asia-Pacific markets largely fell on Tuesday, tracking losses in the S&P 500 and the Nasdaq overnight, while investors assessed industrial profit data out of China. Hong Kong Hang Seng index rose 0.4% in its final hour of trade, while mainland China’s CSI 300 dropped 0.57% and closed at 3,305.33. Japan’s Nikkei 225 rose 0.47% to close at 38,288.62, while the broad-based Topix gained 0.73% to 2,680.80. The only two major indexes in positive territory. South Korea’s Kospi fell 0.32% to close at 2,689.25, while the small cap Kosdaq saw a loss of 0.24% to end at 764.95. Australia’s S&P/ASX 200 reversed gains to decline 0.16%, wrapping its trading session at 8,0845. Earlier in the trading day, the index was close to breaching its all-time closing high of 8,114.7, set on Aug. 1. U.S. crude oil futures slipped below $77 per barrel on Tuesday, after surging in the previous session on OPEC member Libya halting production and exports. Libya produces about 1.2 million barrels per day with the overwhelming majority of its crude exported to the global market, with European nations serving as the main buyers. U.S. oil surged because it is the best substitute for importers looking to replace lost Libyan supply. But the U.S. benchmark is pulling back slightly as the market expects a gradual disruption rather than all of Libya’s production suddenly going offline, Sara Vakhshouri, founder of SVB Energy International, told CNBC’s “Capital Connection” on Tuesday. West Texas Intermediate October contract: $76.99 per barrel, down 43 cents, or 0.56%. Year to date, U.S. crude oil has gained 7.4%. Brent October contract: $80.96 per barrel, down 47 cents, or 0.58%. Year to date, the global benchmark is ahead 5.1%. Gold prices eased on Tuesday, consolidating near record highs reached last week, as investors sought clarity on the magnitude of an imminent interest rate cut from the Federal Reserve ahead of an inflation report due this week. Spot gold fell 0.3% to $2,510.31 per ounce. U.S. gold futures fell 0.4% to $2,545.60. “Gold has by now priced in a September start to the U.S. rate-cutting cycle, so prices may struggle in the short term to reach much higher levels, unless U.S. economic data weakness supports a 50 bps cut instead of the expected 25 bps,” Ole Hansen, head of commodity strategy at Saxo Bank, said.
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