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US STOCKS-Futures slip as rate-cut uncertainty persists; data on tap
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US STOCKS-Futures slip as rate-cut uncertainty persists; data on tap
May 30, 2024 3:28 AM

(For a Reuters live blog on U.S., UK and European stock

markets, click or type LIVE/ in a news window.)

*

Futures off: Dow 0.86%, S&P 0.44%, Nasdaq 0.41%

May 30 (Reuters) - Uncertainty around how long the

Federal Reserve could keep interest rates elevated weighed on

U.S. stock index futures on Thursday, while investors were

cautious ahead of crucial data that could help decipher the

state of the economy.

Megacaps such as Alphabet, Microsoft ( MSFT ) and

Nvidia ( NVDA ) slipped between 0.3% and 0.8% in trading before

the bell as the yield on Treasury notes hovered above 4.5% for

the second day across the board - the highest since the first

week of May.

Rising bond yields typically reflect expectations for higher

interest rates, which in turn means costlier financing and

smaller profit margins for companies.

At the top of investors' watchlist is the second estimate

for first-quarter gross domestic product, expected at 8:30 a.m.

ET. According to a Reuters poll, the world's largest economy

expanded by 1.3%, slightly less than the previously thought

1.6%.

Also on tap is jobless claims data, expected to show that

the number of Americans filing for State unemployment benefits

stood at 218,000, from 215,000 recorded the previous week.

The benchmark S&P 500 index is on track for its

biggest weekly drop in six, while the blue-chip Dow

closed at a four-week low on Wednesday.

Signs of persistent price pressures pushed the majority of

market expectations for at least a 25-basis-point rate cut to

the last two months of the year, according to the CME Group's

FedWatch Tool.

A central bank survey signaled that economic activity

continued to expand from early April through mid-May, but firms

grew more pessimistic about the future as demand weakened and

inflation continued to rise at a modest pace.

April's personal consumption expenditure report - the Fed's

preferred inflation gauge, due on Friday - could sway bets on

the timing of the central bank's first cut.

Hawkish comments from policymakers have also dampened risk

sentiment, and traders will assess remarks from New York Fed

President John Williams and Dallas Fed President Lorie Logan

later in the day.

At 5:37 a.m. ET, Dow e-minis were down 333 points,

or 0.86%, S&P 500 e-minis were down 23.5 points, or

0.44%, and Nasdaq 100 e-minis

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