* Futures: Dow down 0.28%, S&P up 0.23%, Nasdaq up 0.24%

* Seagate ( STX ) gains after forecasting revenue, profit above

estimates

* Ford rises after lifting FY profit outlook

* Fed verdict due at 2:00 pm ET

(Updates prices throughout; adds analyst comment)

By Johann M Cherian and Ragini Mathur

July 29 (Reuters) - S&P 500 and Nasdaq futures inched higher

on Wednesday as investors awaited the Federal Reserve's monetary

policy verdict against a backdrop of simmering Middle East

tensions, while chip stocks struggled ahead of Big Tech earnings

later this week.

Global markets have been volatile this month as investors

questioned the sustainability of the AI spending boom after

signs that major U.S. companies were deepening a web of

AI-linked investments and continuing to funnel billions into the

technology at the expense of free cash flow.

The scrutiny comes as competition from China heats up, both

in the race to develop advanced chips and as Chinese firms roll

out cheaper AI models. On Wednesday, the rout extended from Asia

through Europe after South Korean chipmaker SK Hynix's ( SKHY )

bumper quarterly results fell short of lofty

investor expectations.

U.S.-listed shares of the company dipped 1.2% in

premarket trading, while other chip stocks seesawed in volatile

trade. Nvidia ( NVDA ) inched up 0.1%, Intel ( INTC ) climbed

1.4%, Applied Materials ( AMAT ) dropped 3.2% and Sandisk ( SNDK )

edged down 0.3%.

Data storage provider Seagate Technology ( STX ) was a

bright spot, climbing 5.7% after forecasting quarterly results

above estimates. KLA Corp ( KLAC ), meanwhile, forecast

stronger-than-expected first-quarter revenue, but its shares

fell 7.5% as investors sought more.

Results from Microsoft ( MSFT ), Meta, Amazon.com ( AMZN )

and Apple ( AAPL ) later this week will be closely

watched for signs that their billion-dollar AI investments were

boosting earnings. Shares of the companies were marginally

higher.

At 7:09 a.m. ET, Dow E-minis were down 146 points,

or 0.28%, and S&P 500 E-minis were up 17.5 points, or

0.23%. Nasdaq 100 E-minis were up 67 points, or 0.24%.

Tech concerns have pushed the Nasdaq to a

three-month low, prompting investors to focus on other areas of

the market such as consumer staples and healthcare

. The blue-chip Dow is also at a two-week high.

FED IN FOCUS

The Fed will announce its monetary policy verdict at 2:00

p.m. ET against the backdrop of crude prices soaring by

4.4% to $87.75 a barrel, as tensions in the Middle East flared

up.

"With oil prices remaining volatile and inflation

expectations at risk of de-anchoring, we don't expect the Fed

can hold with the same conviction it's shown recently," said

Michael McGowan, chief investment strategist at Pathstone.

"If the Fed holds, potential dissents in favor of hikes

could be an interesting tell."

Traders see a 38% chance of a rate hike, according to LSEG

data, following a report showing that price pressures eased in

the prior month.

Still, markets expect rates to rise by at least 25 basis

points by year-end, as tariff costs and higher energy prices

feed into inflation.

Markets will scrutinize Chairman Kevin Warsh's comments

following the decision to gauge his tone on monetary policy at a

time when he has said that the central bank will avoid offering

any guidance on interest rates.

Ford Motor ( F ) gained 5.5% after raising its annual profit

outlook for a second time this year.

The second-quarter earnings season has reflected healthy

corporate performance, with 85.2% of the 169 S&P 500 companies

that have reported earnings having surpassed expectations,

LSEG-compiled data showed. Historically, 68% of companies have

achieved that feat.