Dow Jones futures, along with S&P 500 futures and Nasdaq 100 futures, edged lower on Tuesday morning as investors await key economic updates and corporate earnings.
Nvidia Faces Sell Signal as Shares Drop
Nvidia (NVDA) saw a significant decline of 1.7%, marking its lowest point since October 15. This drop triggered the 7% loss rule, signaling a potential sell-off after a breakout move in mid-October. The stock closed well below its critical 50-day moving average, a key technical indicator for market health. Additionally, Nvidia continued to slide in after-hours trading, dropping another 0.6%.
Meanwhile, Taiwan Semiconductor Manufacturing (TSM), Nvidia’s chip-making partner, moved closer to a potential breakout point. TSM shares rose slightly late on Monday, nearing a 205.63 buy point based on a cup-with-handle pattern.
Market Performance: Mixed Results
On Monday, the Dow Jones Industrial Average fell by 0.3%. In contrast, the S&P 500 gained 0.4%, and the Nasdaq surged by 1.2%, reaching another record high.
Federal Reserve’s Upcoming Decision and Economic Reports
Last week’s consumer price index (CPI) and producer price index (PPI) reports for November largely removed any doubts about a Federal Reserve interest rate cut. A quarter-point reduction is now expected. However, investors remain uncertain about the Fed’s plans for 2025. The central bank’s new quarterly projections, due out Wednesday, may suggest a modest half-point cut, bringing rates to a range of 3.75% to 4%.
Retail Sales and Inflation Data Expected
Ahead of Wednesday’s Fed meeting, November’s retail sales report is set to be released Tuesday. Analysts expect a solid 0.4% increase in overall sales, with a 0.5% rise excluding auto sales, according to FactSet. On Friday, the government will release personal income and outlay data, which will include an update on the core personal consumption expenditures (PCE) price index—an important gauge of inflation closely watched by the Fed.
Earnings Reports to Watch This Week
This week will also bring several high-profile earnings reports, including those from Darden Restaurants (DRI), Nike (NKE), FedEx (FDX), Micron Technology (MU), and Carnival (CCL).
