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US moves towards faster stock settlement

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Apple ( AAPL ) gains on strong iPhone sales in China

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UBS lifts S&P 500's year-end target to Street high of

5,600

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Futures: Dow down 0.08%, S&P up 0.15%, Nasdaq up 0.24%

(Updated at 8:35 a.m. ET/ 1235 GMT)

By Johann M Cherian and Lisa Pauline Mattackal

May 28 (Reuters) - The S&P 500 and the Nasdaq were on

track for a higher open on Tuesday after a holiday-extended

weekend, as investors awaited key inflation data later in the

week that could influence expectations for the Federal Reserve's

policy trajectory.

The possibility that the world's most influential

central bank could kick off interest-rate cuts this year has

sent Wall Street on a record-breaking rally since late 2023,

with the tech-heavy Nasdaq and the benchmark S&P 500

notching their fifth straight week of gains on Friday.

However, expectations of when the first rate reduction

could come have see-sawed as Fed policymakers continue to

dismiss the imminent need for one, given data reflecting a

still-resilient economy and sticky inflation.

Market attention now shifts to the U.S. core Personal

Consumption Expenditures Price Index report for April, due later

in the week. The Fed's preferred inflation barometer is expected

to hold steady on a monthly basis.

Traders see a 51.2% chance that the first rate cut of

at-least 25 basis points could be delivered in September,

according to the CME FedWatch Tool.

"The Fed is still in play... real interest rates need to

come down. There's a lot of sourness out there at the price of

things like food and energy. Overall, inflation is trending down

and slowing inflation will give the Fed cover to lower rates,"

said Kim Forrest, chief investment officer at Bokeh Capital

Partners.

U.S. trading moves to a shorter settlement on Tuesday, which

regulators hope will reduce risk and improve efficiency in the

world's largest financial markets, but is expected to

temporarily increase transaction failure for investors.

Among other data, the U.S. consumer confidence report for

May is due at 10 a.m. ET, while the second estimate for

first-quarter gross domestic product and the Fed's Beige Book,

along with remarks from a number of central bankers, are

expected through the week.

Minneapolis Fed President Neel Kashkari said in an interview

with CNBC broadcast that the U.S. central bank should wait

before cutting interest rates, adding that it could potentially

even hike rates if inflation fails to fall further.

At 8:35 a.m. ET, Dow e-minis were down 32 points,

or 0.08%, S&P 500 e-minis were up 8 points, or 0.15%,

and Nasdaq 100 e-minis were up 45.5 points, or 0.24%.

UBS Global Research raised its year-end target for the

benchmark index to 5,600 from an earlier projection of 5,400,

marking the highest forecast among major brokerages.

Nasdaq futures rose, led by a

3

% rise in AI darling Nvidia ( NVDA ), after closing at a

record high on Friday.

Apple ( AAPL ) jumped, up 1.7% after iPhone sales in China

surged 52% in April from a year earlier, Reuters calculations

based on industry data showed. Apple ( AAPL ) supplier Qualcomm ( QCOM )

also rose 2.9%.

Meme stock GameStop ( GME ) shot up 22% after the videogame

retailer said late on Friday it had raised $933 million by

selling 45 million shares, as part of an "at-the-market"

offering.

Norwegian Cruise Line ( NCLH ) added 3.4% after

brokerage Mizuho upgraded the stock to "buy" from "neutral".