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US stock futures muted after tech losses, rate uncertainty dent Wall St

2024-11-28 12:14:50

Investing.com-- U.S. stock index futures steadied on Wednesday evening following a negative session on Wall Street as weak earnings and increased regulatory jitters dented technology shares.

Investors also grew more uncertain over the outlook for interest rates after a batch of strong data showed resilience in the economy. Sentiment was especially peeved by a closely watched inflation gauge that is preferred by the Federal Reserve.

Trading volumes were muted, and are expected to dwindle further in the remainder of the week, on account of the Thanksgiving holiday.

S&P 500 Futures rose slightly to 6,017.75 points, while Nasdaq 100 Futures steadied at 20,819.50 points by 18:17 ET (23:17 GMT). Dow Jones Futures rose less than 0.1% to 44,852.0 points.

Tech hit by weak earnings, Microsoft’s FTC jitters

Losses in technology shares dented Wall Street on Wednesday, especially as a raft of weak earnings raised questions over how much of an earnings driver artificial intelligence was for the broader sector.

PC makers Dell Technologies Inc (NYSE:DELL) and HP Inc (NYSE:HPQ) both tumbled after their quarterly earnings and guidance underwhelmed, as AI provided only a limited earnings boost. Losses in the two spilled over into other AI-exposed stocks, with market darling NVIDIA Corporation (NASDAQ:NVDA) losing 1.2%.

Microsoft Corporation (NASDAQ:MSFT) was also a major weight on Wall Street, losing 1.2% as Bloomberg reported the U.S. Federal Trade Commission had launched a sweeping antitrust investigation into the company. The stock fell further in aftermarket trade.

Reports of Microsoft’s investigation come just days after U.S. authorities recommended tech giant Alphabet Inc (NASDAQ:GOOGL) divest some of its key assets, including web browser Google Chrome, over violations of antitrust laws. The news spurred some concerns over increased regulatory headwinds for America’s biggest tech firms, although the policy outlook is unclear in the face of a Donald Trump presidency.

Rate jitters weigh on Wall St after strong data

Wall Street indexes retreated on Wednesday after a swathe of strong economic readings kept doubts over future interest rate cuts in play. Still, overall losses were limited, and Wall Street remained near record highs, as strength in the U.S. economy drove trades into economically sensitive sectors.

The S&P 500 fell 0.4% to 5,988.74 points, while the NASDAQ Composite fell 0.6% to 19,061.78 points. The Dow Jones Industrial Average closed 0.3% lower at 44,722.06 points.

PCE price index data- which is the Fed’s preferred inflation gauge- rose as expected in October, indicating that inflation remained well above the central bank’s 2% annual target.

Weekly jobless claims data was slightly better than expected, while a revised reading on third-quarter gross domestic product showed economic growth remained steady.

Strength in the U.S. economy is expected to give the Fed more headroom to take its time in lowering rates. The minutes of the Fed’s November meeting showed this week that policymakers favored a gradual easing in rates.

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