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US futures slip from records as Fed decision takes center stage




US futures slip from records as Fed decision takes center stage

U.S. stock futures fell on Tuesday, setting the stage for a retreat from record highs as investors awaited the start of a Federal Reserve meeting that should indicate the path of interest rates.

Futures on the S&P 500 () and the tech-heavy Nasdaq 100 () both fell about 0.3% from all-time highs. Dow Jones Industrial Average futures () fell 0.4%.

Stocks have managed to make progress amid market uncertainty about an economy that may be too hot or too cold for comfort. A series of inconclusive data has fueled skepticism about the likelihood of three rate cuts in 2024, as the Fed envisioned in March. Many investors are now predicting just one cut before the end of the year.

The two-day Fed policy meeting that starts Tuesday is expected to end with borrowing costs remaining at their highest level in two decades. Investors will still be on the lookout for clues as to when a shift to austerity will occur, with September or November on the horizon.

Read more: What influence does the labor market have on inflation?

Investors calculating the chances of a rate cut are also looking ahead to May consumer price data due Wednesday, given its crucial role in the Fed’s deliberations.

Meanwhile, shares of Apple ( AAPL ) remained in the red after losses followed the iPhone maker’s big AI debut. On the other hand, shares of Eli Lilly (LLY) rose after the drugmaker’s early treatment for Alzheimer’s disease received unanimous support from a panel of FDA advisors.

Live1 update

  • Diverging opinions on Apple after AI event

    There’s no clear consensus on Apple ( AAPL ) stock after yesterday’s hype-filled AI event.

    The Street is giving Apple a high five on the technology itself, but what’s unclear is whether this will be enough to fuel an iPhone upgrade cycle that moves stock prices.

    JP Morgan about the event:

    “We continue to expect a device upgrade cycle for iPhones to occur later this fall (largely FY25 for Apple), with the upgrade cycle likely to peak with the launch of the iPhone 17 in 2025 (largely FY26 volumes for Apple).”

    KeyBanc at the event:

    “We believe that WWDC is a ‘sell-the-news’ event where the bulls’ vision, centered around an ‘iPhone Super Cycle’ brought about by the integration of Apple Intelligence (AI) into Apple’s products, likely to be seen as disappointing. While WWDC’s new software features on iOS, iPad OS, macOS and visionOS are often useful, we don’t think they’re compelling the average consumer to purchase a new device.”

    The stock is down slightly in premarket trading.