U.S. stock futures were largely flat Tuesday as market participants awaited quarterly results from chipmaker Micron (NASDAQ:MU) and remarks from Federal Reserve officials. Optimism is high around Micron due to anticipated strong demand for its processors supporting AI workloads. Meanwhile, preliminary U.S. business activity data for September may provide insight into corporate momentum late in the third quarter.
Futures see little action
By 03:29 ET, Dow, S&P 500, and Nasdaq 100 futures were mostly steady. Monday’s session saw technology shares lead Wall Street higher, further fueled by Nvidia’s announcement of a $100 billion investment in OpenAI to expand data center infrastructure, a move some analysts found surprising because it supports a client purchasing its equipment.
U.S. Treasury yields ticked higher following cautious comments from several Fed officials regarding potential future interest rate cuts.
Micron report in spotlight
Micron is expected to release its quarterly earnings after Tuesday’s market close. Investor sentiment has been largely positive, reflecting expectations that high demand and tighter supply conditions for its memory chips will support strong revenue and profit.
For the quarter ending August 28, Micron now anticipates revenue of $11.2 billion, plus or minus $100 million, compared with the prior estimate of $10.7 billion, plus or minus $300 million. Adjusted gross margin is expected at 44.5%, versus the previous guidance of 42%.
Chief Business Officer Sumit Sadana commented that pricing trends have been “robust” and that the company has had “great success in being able to push that pricing up.”
Flash PMIs on tap
Attention will also turn to preliminary September business activity data from S&P Global. The composite PMI is expected to hold steady at 54.6, with the manufacturing sector dipping slightly to 52.2 from 53.0, and services forecast at 54.0 from 54.5. Levels above 50 indicate expansion.
Powell’s remarks under scrutiny
ING analysts noted that “what should get attention” are upcoming Fed speeches, particularly from Chair Jerome Powell.
Following last week’s 25-basis-point rate cut, market expectations for future policy remain uncertain. Newly appointed Fed Governor Stephen Miran on Monday called for more aggressive cuts, echoing President Donald Trump’s view that rates should fall rapidly. Some other officials, however, favor a more cautious approach.
Currently, markets see a roughly 90% chance of a 25-basis-point rate cut in October, with a 75% probability of another in December, according to CME’s FedWatch Tool.
Oil slips amid oversupply concerns
Oil prices fell for a fifth session in a row after Iraq and Kurdish regional governments reached a preliminary deal to restart a pipeline.
At 03:30 ET, Brent futures dropped 0.4% to $66.32 a barrel, and WTI fell 0.3% to $62.08 a barrel. The agreement could allow roughly 230,000 barrels per day to resume from Iraqi Kurdistan, where exports have been halted since March 2023.
The International Energy Agency highlighted that global oil supply is expected to grow faster this year, with surpluses potentially increasing in 2026 due to higher production from OPEC+ and non-OPEC countries.
This content is for informational purposes only and does not constitute financial, investment, or other professional advice. It should not be considered a recommendation to buy or sell any securities or financial instruments. All investments involve risk, including the potential loss of principal. Past performance is not indicative of future results. You should conduct your own research and consult with a qualified financial advisor before making any investment decisions.
Leave a Reply