US STOCKS-Wall St set to stall at open after recent run

U.S. stock index futures indicated a mixed open on Tuesday after recent gains on expectations that the Federal Reserve will cut interest rates this year, as shares of Walt Disney slid following quarterly results. Walt Disney fell 5.1% in premarket trading, as a surprise profit in its streaming entertainment division was eclipsed by a drop in its traditional TV business and weaker box office.

U.S. stock index futures indicated a mixed open on Tuesday after recent gains on expectations that the Federal Reserve will cut interest rates this year, as shares of Walt Disney slid following quarterly results.

Walt Disney fell 5.1% in premarket trading, as a surprise profit in its streaming entertainment division was eclipsed by a drop in its traditional TV business and weaker box office. A dip in Nvidia and Tesla shares also looked set to pressure the tech-heavy Nasdaq.

The three main U.S. stock indexes closed at their strongest level in more than three weeks on Monday after a weaker-than-expected labor market report last week fueled bets that the U.S. central bank will ease monetary policy this year. The report and better-than-expected earnings reports have helped soothe jittery investors, who sent markets lower in April, on concerns that sticky inflation and a robust economy would prompt the Fed to keep rates higher for longer.

"The market is still pricing inflation will ultimately be conquered, maybe not down to 2%, but certainly under 3%. The central banks will win there and the cost will be a slower economy," said Hal Reynolds, chief investment officer at Los Angeles Capital Management. "That will happen sometime later this year or early next year and these rate cuts will come. But there is still a fair bit of noise. I don't think things are much clearer today than they were two months ago."

Traders currently anticipate rate cuts of 45 basis points (bps) from the Fed by the end of 2024, according to LSEG's interest rate probabilities app, with the first pivot to rate cut priced in for September and another in December. Investors will keep an eye on Minneapolis Fed President Neel Kashkari's speech later in the day. Richmond Fed President Thomas Barkin said on Monday finishing the battle against inflation will likely require a hit to demand, while his New York counterpart John Williams said that at some undefined point the U.S. central bank will lower its interest rate target.

At 8:33 a.m. ET, S&P 500 e-minis were up 1.75 points, or 0.03%. Nasdaq 100 e-minis slipped 30.75 points, or 0.17%, while Dow e-minis climbed 19 points, or 0.05%. The earnings season has been largely supportive for markets. Of the nearly four-fifth of the S&P 500 companies that reported first-quarter results through Friday, 76.8% topped analysts' profit estimates, as per LSEG data. In a typical quarter, 67% beat earnings estimates.

Kenvue gained 3.6% after the Band-Aid maker beat first-quarter profit estimates and said it would cut 4% of its global workforce. Nvidia fell 0.9% after the Wall Street Journal reported that Apple was developing its own chip to run artificial intelligence (AI) software in data centers.

Apple gained 0.9% ahead of an event later on Tuesday where it is expected to unveil new iPads. Tesla fell 1.8% after data showed the U.S. automaker sold 62,167 China-made electric vehicles in April, down 18% from a year earlier.

Palantir Technologies tumbled 11.4% after the data analytics firm's annual revenue forecast fell short of analysts' estimates.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)