US pre-open: Futures lower ahead of FOMC meeting

19th Mar 2024 10:45

(Sharecast News) - US futures were in the red ahead of the bell on Tuesday as market participants patiently awaited the outcome of the Federal Reserve Open Markets Committee's March policy meeting.

As of 1215 GMT, Dow Jones futures were down 0.18%, while S&P 500 and Nasdaq-100 futures had the indices opening 0.43% and 0.63% weaker, respectively.

The Dow closed 75.66 points higher on Monday as stocks reclaimed some of last week's losses.

Investors will turn their attention to Washington on Tuesday as the Federal Reserve kicks off its two-day policy meeting, with a recent batch of concerning inflation figures leaving traders fearful that the central bank may look to hold benchmark interest rates at a higher level for longer than previously expected.

Also in focus, Wall Street darling Nvidia traded lower in pre-market following its first-ever GTC Conference, during which chief executive Jensen Huang unveiled its latest artificial intelligence chip, Blackwell, which he claimed was significantly more powerful than its current chips.

Trade Nation's David Morrison said: "All the US indices are weaker this morning, but not by much. Investors are likely to sit on their hands now during the two-day Fed meeting which ends tomorrow. There's virtually no chance of the Fed announcing any change to interest rates at this meeting. But its accompanying statement, its quarterly Summary of Economic Projections and Fed Chair Powell's subsequent press conference all offer up opportunities for the US central bank to provide insight into its current thinking. The concern is that, following last week's disappointing inflation releases, the Fed may indicate that it is pushing out further the timing of its first rate cut since March 2020. This could also see it revise downward its projections for how many cuts we may see this year.

"The June meeting is currently the favourite for the first cut, and there's no doubt that there will be plenty more inflation updates, along with other significant data releases, which will help give a clearer picture about the state of the US economy before then. But a shift towards September can't be ruled out. In addition, analysts will be listening out for any changes the Fed may make to its balance sheet reduction programme."

On the macro front, February housing starts and building permits data will be published at 1230 GMT.

No major corporate earnings were slated for release on Tuesday.

Reporting by Iain Gilbert at Sharecast.com