(Reuters) -U.S. stock index futures wavered on Monday, pausing after a recent rally as investors shifted their focus to earnings from big box retailers and an annual central bank conference at Jackson Hole, all of which are lined up later this week.
Geopolitics was also in the spotlight as Donald Trump was set to meet Ukraine’s Volodymyr Zelenskiy and European leaders to map out a peace deal between Kyiv and Moscow, following the U.S. President’s summit with Russia’s Vladimir Putin last week, which yielded no concrete outcome.
Wall Street’s main indexes rallied over the past two weeks, with the blue-chip Dow hitting an intra-day record high on Friday, aided by interest rate cut expectations and a better-than-expected earnings season despite an uncertain trade environment.
Investors will closely monitor reports from Walmart, Home Depot and Target among others, which are expected this week, to determine how trade uncertainty and inflation expectations have affected the American consumer.
Data on Friday showed that while retail sales were increasing broadly as anticipated, consumer sentiment overall had taken a hit from mounting inflation fears.
“The U.S. earnings season has so far been very robust as it draws to a close, but updates from Walmart and Home Depot this week are likely to be closely watched as investors look for an indication as to how the US consumer is faring,” said AJ Bell’s investment director Russ Mould.
At 05:35 a.m. ET, Dow E-minis were down 47 points, or 0.10%, S&P 500 E-minis were down 10 points, or 0.15% and Nasdaq 100 E-minis were down 38.5 points, or 0.16%.
Investors continue to price a 25 basis point cut from the Federal Reserve next month, although they have lowered their expectations for another rate cut this year, according to data compiled by LSEG.
Recent data has also suggested that while U.S. tariffs have not filtered into headline consumer prices yet, jobs market weakness could nudge the central bank to take a more dovish stance.
Markets hope that the Fed’s Jackson Hole, Wyoming conference between August 21 and 23, where Chair Jerome Powell is expected to speak, could offer more clarity on the economic outlook and the central bank’s policy framework.
On the trade front, the Trump administration widened the reach of its 50% tariffs on steel and aluminum imports by adding hundreds of derivative products to the list of goods subject to the levies.
Among early movers, UnitedHealth rose 2.7% in premarket trading, building on its nearly 12% jump in the previous session.
Crypto stocks such as Strategy and Coinbase declined about 2% each, tracking a 2.5% drop in bitcoin prices.
Markets were also assessing multiple deals on the mergers and acquisitions front.
Dayforce surged 21.4% after a report said PE firm Thoma Bravo is in talks to acquire the HR management software firm, while Soho House jumped 13.3% as another report said a group of investors led by New York-based MCR Hotels is nearing a deal to take the members’ club operator private.
(Reporting by Johann M Cherian in Bengaluru; Editing by Shinjini Ganguli)
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