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By Ankika Biswas and Lisa Pauline Mattakal
(Reuters) – Wall Street was set to open lower on Tuesday as blue-chip stocks retreated after a strong session, with caution growing ahead of fresh jobs data and comments from Federal Reserve Chairman Jerome Powell later in the day.
Tech giants Microsoft (NASDAQ:), Apple (NASDAQ:) and Alphabet (NASDAQ:) fell between 0.4% and 0.8% in premarket trading, retreating from gains in the previous session.
Benchmark 10-year Treasury yields were down slightly on the day but hovered around multi-week highs, also weighing on price-sensitive growth stocks. [US/]
“Inflation is holding steady, interest rates are staying high, and there seems to be a bit of rotation or at least profit-taking in some of these names that have done really well,” said Robert Pavlik, senior portfolio manager at Dakota Wealth.
Pavlik also noted that investors are looking to adjust their portfolios ahead of the US presidential election, as the prospect of a second term for former President Donald Trump increases.
Shares of AI chipmaker Nvidia (NASDAQ:NVIDIA), also fell 1.2%, with other semiconductor stocks such as Micron Technology (NASDAQ:M) and Marvell Technology (NASDAQ:M) also falling. arm Holdings (NASDAQ:) shares also fell between 1% and 1.7%.
On the data front, the Job Openings and Labor Turnover Survey, or JOLTS, is due after the market opens and is expected to show that job openings fell to 7.910 million in May from 8.059 million the previous month.
The data is the first in a series of U.S. jobs reports this week, especially Friday’s nonfarm payrolls, which will be crucial in assessing whether the U.S. labor market is holding up against decades-high interest rates – a key factor in determining the health of the economy.
Investors will be parsing Powell’s remarks at a policy symposium ahead of the European Central Bank’s forum on central banking for further clues on how policymakers are assessing recent data.
While recent data points to a renewed slowdown in inflation and some signs of economic weakness, market participants are holding onto their bets on two rate cuts by the end of this year, starting in September, according to LSEG’s FedWatch data.
With the stock market closed on Thursday for US Independence Day, trading volumes are expected to be light throughout the week.
By 8:42 a.m. ET, the S&P 500 was down about 120 points, or 0.3%, down about 23 points, or 0.42%, and down about 104 points, or 0.52%.
Among other things, Paramount Global shares rose 3.8% after billionaire Barry Diller’s digital media company IAC explored a bid to take control of the media giant.
Atlassian (NASDAQ:ATL) rose 2.7% after Piper Sandler raised its rating on the enterprise software company to “overweight” from “neutral,” while CrowdStrike Holdings (NASDAQ:CSH) fell 2.3% after the same brokerage downgraded the cybersecurity company to “neutral” from “overweight.”
Shares of New York-listed drugmaker Novo Nordisk fell 3.0%, while rival Eli Lilly fell 1.9% after U.S. President Joe Biden and Sen. Bernie Sanders called on the Danish drugmaker to lower prices for its Ozempic and Wegovy drugs.
