US Index Futures Decline Ahead of Federal Reserve Meeting, Oil Prices Retreat

In Tuesday’s pre-market trading, U.S. index futures are pointing to a decline, reflecting investors’ caution as they analyze revelations from Nvidia’s artificial intelligence conference and the growing anticipation for the future direction of U.S. monetary policy, especially with the commencement of the Federal Reserve’s (Fed) two-day meeting scheduled for today.

By 06:30 AM, Dow Jones futures (DOWI:DJI) dropped 27 points, or -0.07%. S&P 500 futures fell -0.17%, and Nasdaq-100 futures lost -0.26%. The yield on 10-year Treasury notes stood at 4.314%.

In the commodities market, West Texas Intermediate crude oil for April fell 0.31%, to $82.46 per barrel. Brent crude oil for May dropped 0.36%, close to $86.58 per barrel. Iron ore traded on the Dalian exchange rose 5.35%, to $114.87 per metric ton.

On Tuesday’s economic agenda, the spotlight is on the report on new home construction for February, to be released at 8:30 AM. A monthly growth of 2.0% is anticipated.

In the Asia-Pacific equity markets, the Shanghai Composite and Shenzhen Composite indices recorded declines, as did the Hang Seng in Hong Kong and the Kospi in South Korea, reflecting a challenging day in the Asian markets. In a move that didn’t surprise the market, the Bank of Japan (BoJ) raised its interest rate from -0.1% to between 0% and 0.1%, marking its first increase since 2007. Despite the change, BoJ President Kazuo Ueda assured that monetary policy would remain accommodative. Japan’s Nikkei index closed up +0.66%.

European markets show a mixed trend as international investors eagerly await the start of the Federal Reserve meeting, which will last two days and is crucial for setting monetary policy. Meanwhile, shares in the oil and gas sector are experiencing a 0.7% increase, contrasting with a 0.7% decrease observed in the utilities segment.

On Monday, U.S. stock markets closed higher, with the Dow Jones, S&P 500, and Nasdaq ending up 0.20%, 0.63%, and 0.82%, respectively. The technology sector drove the market, with standout performances from Alphabet (NASDAQ:GOOGL) and Nvidia (NASDAQ:NVDA). As investors await the Federal Reserve meeting, a report indicated an improvement in U.S. home builders’ confidence.

On the earnings front, companies scheduled to present financial reports before the market opens include Xpeng (NYSE:XPEV), Tencent Music Entertainment (NYSE:TME), HUYA Inc (NYSE:HUYA), Caleres Inc (NYSE:CAL), Core & Main (NYSE:CNM), among others.

After the close, earnings from Terawulf Inc (NASDAQ:WULF), Healthequity Inc (NASDAQ:HQY), ZTO Express (NYSE:ZTO), Harrow Inc (NASDAQ:HROW), Precigen (NASDAQ:PGEN), Cyclacel (NASDAQ:CYCC), Corvus Pharmaceuticals (NASDAQ:CRVS), Design Therapeutics (NASDAQ:DSGN), Taysha Gene Therapies (NASDAQ:TSHA), Reimada Therapeutics (NASDAQ:RLMD), and more are awaited.