Futures Pointing To Continued Weakness On Wall Street

(RTTNews) - The major U.S. index futures are currently pointing to a lower open on Tuesday, with stocks likely to see further downside following the modest pullback seen on Monday.

Traders may continue to cash in on recent strength in the markets, which lifted the S&P 500 and the Nasdaq to record closing highs last Friday.

Uncertainty about the outlook for interest rates may also weigh on the markets ahead of congressional testimony by Federal Reserve Chair Jerome Powell

Powell is due to testify before the House Financial Services Committee on Wednesday and the Senate Banking Committee on Thursday.

The Fed chief is likely to reiterate recent comments stressing the central bank needs greater confidence inflation is slowing before cutting interest rates.

The next monetary policy meeting is scheduled for March 19-20, with the Fed widely expected to leave interest rates unchanged.

After a weak start and a long spell in negative territory, U.S. stocks briefly managed to turn positive in the final hour of trading on Monday but failed to find support and ended marginally lower.

The mood was cautious throughout the day's session due to a lack of major U.S. economic data. Traders largely stayed on the sidelines ahead of a several key events this week.

The major averages all ended in negative territory. The Dow ended down 97.55 points or 0.3 percent at 38,989.83. The S&P 500 settled with a loss of 6.13 points or 0.1 percent at 5,130.95, while the Nasdaq ended lower by 67.43 points or 0.4 percent at 16,207.51.

Tesla dropped more than 7 percent. Walgreens Boots Alliance, Target, Alphabet, Pfizer, Apple Inc., Nike and Merck lost 2 to 4 percent.

Intel, Nvidia, IBM, Bank of America, Ford Motor, Qualcomm, eBay, Walt Disney, General Electric, Wells Fargo, Costco and Citigroup posted strong gains.

Later in the week, the Labor Department's monthly employment report is due to be released on Friday. The report is expected to show employment jumped by 200,000 jobs in February after surging by 353,000 jobs in January.

Commodity, Currency Markets

Crude oil futures are slumping $1.08 to $77.66 a barrel after tumbling $1.23 to $78.74 a barrel on Monday. Meanwhile, after surging $30.60 to $2,126.30 an ounce in the previous session, gold futures are climbing $12.50 to $2,138.80 an ounce.

On the currency front, the U.S. dollar is trading at 150.15 yen compared to the 150.53 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.0849 compared to yesterday's $1.0856.

Asia

Asian stocks ended mostly lower on Tuesday as China's week-long annual session of parliament commenced without any big-ticket stimulus plans to prop up the struggling economy.

China is aiming for five percent GDP growth this year but there is reluctance to use deficit spending for economic stimulus.

The Chinese government has set the targeted fiscal deficit-to-GDP ratio at 3 percent this year, down from a revised 3.8 percent last year.

China's Shanghai Composite Index settled 0.3 percent higher at 3,047.79 after a choppy session.

Hong Kong's Hang Seng Index plunged 2.6 percent to 16,162.64 as a private survey pointed to slowing growth in China's key services sector in February.

Japanese markets ended mixed following a retreat from record highs on Wall Street overnight.

Investors also reacted to encouraging service sector activity data for February and reports suggesting that the U.S. government is working to block exports of AI semiconductors to China.

The Nikkei 225 Index ended a choppy session marginally lower at 40,097.63 after hitting a fresh record the previous day. The broader Topix Index rose half a percent to 2,719.93.

Chip-testing equipment maker Advantest fell 2.6 percent, while tech investor SoftBank Group rose 0.8 percent.

Seoul stocks fell notably, dragged down by technology stocks. The Kospi slid 0.9 percent to 2,649.40 ahead of two days of congressional testimony from Fed Chair Jerome Powell.

South Korea's economy grew 0.6 percent in the fourth quarter of 2023 from the previous quarter, revised central bank data showed earlier today.

Australian markets fell for a second straight session, with financial and energy stocks leading losses. Gold miners surged as gold prices soared to three-month highs.

The benchmark S&P/ASX 200 Index slipped 0.2 percent to 7,724.20 ahead of the fourth-quarter GDP data due later in the week.

The broader All Ordinaries index closed 0.1 percent lower at 7,988.30 despite positive services sector activity and current account balance data.

Across the Tasman, New Zealand's benchmark S&P/NZX-50 Index rose 0.3 percent to 11,753.02.

Europe

European stocks have drifted lower on Tuesday amid disappointment from the lack of fresh supportive measures in top consumer China and signs the U.S. Federal Reserve is in no hurry to cut interest rates.

In economic news, a survey showed Business activity in the eurozone's key services sector picked up to a seven-month high in February.

While the French CAC 40 Index has edged down by 0.1 percent, the German DAX Index and the U.K.'s FTSE 100 Index are marginally lower.

In corporate news, Swiss generic and biosimilar manufacturer Sandoz has slumped after completing the acquisition of the U.S. biosimilar CIMERLI (ranibizumab-eqrn) from Coherus BioSciences, Inc, ahead of anticipated timelines.

BP Plc and peer Shell have also moved to the downside as oil extended overnight losses amid concerns about the outlook for energy demand.

Ashtead Group has also plunged after the equipment rental firm narrowed its full-year guidance, citing a lower level of activity in the North America market.

Bayer, a German pharmaceutical and biotechnology major, has also fallen after posting a decline in fourth-quarter sales.

Schaeffler has also tumbled. The manufacturer of rolling element bearings reported that its fiscal 2023 net income attributable to shareholders of the parent company amounted to 310 million euros, down from last year's 557 million euros.

Meanwhile, telecommunications testing firm Spirent has soared after it has agreed to be taken over by U.S. communications equipment company Viavi Solutions in a deal valued at about 1.01 billion pounds ($1.28 billion).

Thales shares have also surged. The French technology firm lifted dividend and projected organic sales growth of between 4 percent and 6 percent for fiscal 2024.

U.S. Economic Reports

The Institute for Supply Management is scheduled to release its report on service sector activity in the month of February at 10 am ET.

The ISM's services PMI is expected to edge down to 53.0 in February after climbing to 53.4 in January, although a reading above 50 would still indicate growth.

Also at 10 am ET, the Commerce Department is due to release its report on new orders for manufactured goods in the month of January. Factory orders are expected to tumble by 2.9 percent.

Stocks In Focus

Shares of GitLab (GTLB) are plummeting in pre-market trading after the software company reported better than expected fourth quarter results but provided disappointing guidance.

Online personal styling service Stitch Fix (SFIX) may also come under pressure after reporting fiscal second quarter revenues that missed analyst estimates.

On the other hand, shares of Target (TGT) are likely to see initial strength after the retail giant reported fourth quarter results that exceeded expectations on both the top and bottom lines.