(Reuters) – U.S. stock index futures were flat to slightly lower ahead of a raft of economic data on Thursday, as investors looked for clues to the size of the Federal Reserve’s interest rate cut expected later this month.
The S&P 500 and tech-heavy Nasdaq closed lower for a second straight session on Wednesday, after job openings fell in July and a Fed survey fueled concerns about slowing economic activity.
Trader bets on a 25 basis point rate cut at the U.S. central bank meeting later in September stand at 59%, according to the CME Group’s FedWatch Tool. Bets on a larger 50 basis point cut rose to 41% from 34% a week earlier.
September has historically been a weak month for U.S. stocks, with the benchmark index down an average of about 1.2% since 1928.
Concerns that a cooling labor market could signal a looming recession have heightened caution. The benchmark S&P 500 index has already fallen more than 2% this week, and technology stocks have fallen nearly 5%.
On Wednesday night, Mary Daly, president of the Federal Reserve Bank of San Francisco and a voting member this year, said the central bank should cut rates to keep the labor market healthy, but it will now be up to incoming economic data to determine by how much.
The focus is on the ADP National Employment Report and weekly jobless claims, ahead of the Labor Department’s crucial nonfarm employment numbers on Friday.
Economists expect the ADP report, due at 8:30 a.m. ET, to show private-sector jobs rose by 145,000 in August, compared with an increase of 122,000 in July.
The Institute of Supply Management survey, due to be released at 10 a.m. ET, is expected to show non-industrial activity stood at 51.1 in August.
At 5:32 a.m. ET, the Dow E-minis were up 24 points, or 0.06%, the S&P 500 E-minis were down 1 point, or 0.02%, and the Nasdaq 100 E-minis were down 39 points, or 0.21%.
Nvidia rose slightly in premarket trading after falling more than 11% in the past two sessions. The AI chip company said Wednesday it had not received a subpoena from the U.S. Department of Justice.
Tesla rose 2.3% after the electric vehicle maker announced it will launch full advanced self-driving software in Europe and China in the first quarter of next year, pending regulatory approval.
Other interest rate-sensitive growth stocks such as Meta, Alphabet and Apple traded flat to slightly lower.
C3.ai fell 18.8% after the AI software company missed quarterly estimates for subscription revenue as companies curbed spending amid economic uncertainties.
Analysts at Goldman Sachs predicted in the run-up to the US presidential election that Democratic presidential candidate Kamala Harris’ proposed corporate tax hike could reduce profits for companies on the S&P 500 index by about 5%, while Republican candidate Donald Trump’s proposed tax cut would boost profits by about 4%.
(Reporting by Johann M Cherian in Bengaluru; Editing by Shounak Dasgupta)
