U.S. stock index futures witnessed a slight decline at the outset of a holiday-shortened week, as market participants anticipate upcoming speeches by Federal Reserve officials and a crucial inflation indicator set to be released later in the week.
Last week, the S&P 500 and the Dow Jones Industrial Average experienced their most significant weekly percentage increases of the year, buoyed by the Federal Reserve's reaffirmation of its plan for three interest rate reductions this year.
Market forecasts now suggest a 75% probability of the Fed implementing the initial rate cut in June, a notable increase from the 55% chance predicted at the beginning of last week, as per the CME FedWatch tool.
Despite market optimism, Atlanta Fed President Raphael Bostic recently adjusted his outlook, now anticipating only a single quarter-point rate cut due to persistent inflation and stronger-than-expected economic data. Other Fed officials, including Chicago Fed President Austan Goolsbee, are also scheduled to speak.
The attention is also on the personal consumption expenditures (PCE) price index for February, the Fed's preferred inflation measure, which is due on Friday. A higher-than-expected PCE index reading could temper expectations for early rate cuts. Additionally, final estimates of the fourth quarter GDP and a consumer confidence report for March are expected in the coming days.
In early trading, Dow e-minis were down by 44 points, S&P 500 e-minis decreased by 5.75 points, and Nasdaq 100 e-minis fell by 32.75 points.
Intel (INTC, Financial) and Advanced Micro Devices (AMD, Financial) saw their shares drop over 2% in premarket trading following reports of China's plans to eliminate U.S. microprocessors in government PCs and servers. Meanwhile, cryptocurrency and blockchain-related stocks, including Coinbase Global (COIN, Financial), Riot Platforms (RIOT, Financial), and MicroStrategy (MSTR, Financial), experienced gains between 2.7% and 5.1%, echoing a surge in bitcoin prices.
While most megacap growth stocks saw a decline, Tesla (TSLA, Financial) stood out with a 0.8% drop. Conversely, Nvidia (NVDA, Financial) enjoyed a 0.9% rise, marking its eleventh consecutive weekly gain. United Airlines (UAL, Financial) also made headlines, dropping 2.1% following the Federal Aviation Administration's announcement of increased oversight.
Over the weekend, President Joe Biden enacted a $1.2 trillion spending bill, ensuring government funding for the current fiscal year, which began six months ago.
