Investing.com-- U.S. stock index futures edged lower on Tuesday evening following a negative session on Wall Street, as caution grew before the Federal Reserve's final interest rate decision for the year.

Markets have fully priced in a 25 basis point cut at the end of a Fed meeting on Wednesday, while the focus will be on long-term rate outlook signals. The Fed is expected to adopt a slower rate cut path after lowering rates in December.

S&P 500 Futures inched 0.1% lower to 6,119.0 points, while Nasdaq 100 Futures fell 0.3% to 22,252.25 points by 18:40 ET (23:38 GMT). 

Dow Jones Futures were largely steady at 43,964.0 points, after the index recorded its longest losing streak since 1978 on Tuesday.

Fed set to cut rates, markets assess retail sales data

Market focus will be squarely on the Fed’s economic projections for the next year, and comments from Chair Jerome Powell. 

This could help investors gauge the Fed’s long-term rate outlook, at a time when inflation has remained stubborn and is expected to rise further under upcoming President Donald Trump.

Investors expect the Fed to indicate a slower pace of rate cuts in 2025, as persistent inflation and a strong labor market—two key challenges for the Fed—continue to pose concerns.

Earlier in the day, data showed that retail sales rose by 0.7% in November, above the 0.5% forecast. 

Stronger-than-expected retail sales data signals that the economy remains strong and consumer spending remains robust, despite challenges like inflation and high interest rates. 

This strength was driven by a solid labor market and steady household finances.

Tech drags Wall St, Dow falls for ninth straight session

Wall Street indexes retreated on Tuesday with the tech sector giving away some of its recent gains, as investors exercised caution ahead of the rate decision.

NVIDIA Corporation (NASDAQ:NVDA) dropped 1.2%, while Alphabet (NASDAQ:GOOG) fell 0.5%

The S&P 500 fell 0.4% to 6050.61 points, while the NASDAQ Composite lost 0.3% to 20,108.30 points. The Dow Jones Industrial Average closed 0.6% lower at 43,449.90 points.

The Nasdaq reached a record high on Monday, and the S&P 500 is sitting on hefty gains this year, but the Dow has faced challenges, marking its ninth consecutive daily decline on Tuesday — the longest losing streak since February 1978.