Market Jitters: Tech Stocks Down Ahead of Nvidia's Key Earnings

U.S. stock index futures slipped on Tuesday amid high equity valuation worries and diminishing hopes for an interest rate cut. Tech stocks, including Amazon and Nvidia, faced pressure. Attention is on Nvidia's earnings and key government data this week. Traders reduced rate-cut expectations for December.

U.S. stock index futures fell on Tuesday as apprehensions over high equity valuations and reduced expectations for an interest rate cut exerted pressure on investor sentiment. Market participants are keenly observing Nvidia's earnings and major government economic data scheduled for release later this week.

Tech heavyweights were under strain in premarket trading, with Amazon.com leading the declines at a 1.2% drop. Chip stocks like Advanced Micro Devices and Broadcom also fell early on. Nvidia's quarterly results, awaited eagerly, are perceived as a crucial test for the artificial intelligence-fueled rally, with their shares down 0.9% after Monday's 2% decline.

Concerns about high valuations alongside skepticism over the Federal Reserve's potential interest rate cut in December have caused a pause in U.S. stock rally momentum, with all major indexes closing lower on Monday. Traders are reassessing the likelihood of a rate cut, with current probability down to 46.4% from previous higher expectations.

(With inputs from agencies.)