U.S. stock futures pointed to a lower open on Friday. This pullback follows a strong session on Thursday. The S&P 500 and Dow Jones Industrial Average both closed at new records. Investors are now shifting their focus to a critical inflation report. The data will provide clues about the Federal Reserve’s next move.
All Eyes on Key Inflation Report
Wall Street is bracing for the July inflation reading. The Personal Consumption Expenditures (PCE) index is due at 8:30 a.m. ET. This is the Federal Reserve’s preferred gauge of inflation. The report will heavily influence the central bank’s interest rate policy. It comes as bets for a rate cut in September have grown.
Fed Officials Signal Possible Rate Cut
Momentum for a rate cut appears to be building. Fed Governor Christopher Waller recently signaled his support. He backed a quarter-point rate cut in September. He also anticipates more cuts in the following months. Fed officials must balance a weakening labor market with signs of stubborn inflation.
Tech Stocks Lead Pre-Market Declines
Futures on the tech-heavy Nasdaq 100 led the morning’s retreat. Contracts were down about 0.5% in pre-market trading. Chipmaker Marvell Technology saw its shares tumble nearly 13%. The drop came after its forecast for data center demand disappointed investors. The news created some anxiety in the AI chip sector, which has recently boosted the market.
Market Pauses After Strong August Rally
The morning caution comes after a solid month for stocks. The S&P 500 is up 2.6% in August. The Dow has gained 3.4% during the month. Renewed optimism around artificial intelligence helped drive major indexes to new highs. Investors are now waiting to see if the inflation data will support further gains.
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