U.S. Stock Index Futures Dip Ahead of Retail Sales Data

(Reuters) – U.S. stock index futures dipped on Tuesday, pressured by rising bond yields as traders awaited retail sales data for insights into consumer health, anticipating a Federal Reserve rate cut later this week.

The U.S. 10-year Treasury note yield climbed back above 4.42%, reaching a three-week high, as market expectations shifted towards a more cautious Fed in 2025.

November retail sales data, to be released at 8:30 a.m. ET, is projected by economists polled by Reuters to rise 0.5% month-over-month.

Futures retreated after a strong Monday session, where the Nasdaq closed at a record high and the S&P 500 gained.

Rate-sensitive giants showed mixed results in premarket trading: Nvidia (NASDAQ:NVDA) fell 2.1% and Microsoft (NASDAQ:MSFT) dipped 0.4%, while Tesla (NASDAQ:TSLA) rose nearly 3% after a previous session's rally of over 6%.

A 25 basis point cut from the Fed on Wednesday seems nearly assured, though many anticipate the central bank to maintain rates at its January meeting, given ongoing economic resilience and persistent inflation.

"The consensus expectation is that investors will receive the extra holiday gift they desire with another quarter-point cut from the Federal Reserve," said Joe Gaffoglio, president and CEO of Mutual of America Capital Management.
"However, if inflation remains above target in the new year, markets may be overly optimistic about the number of cuts the Fed can deliver."

Nonetheless, U.S. stocks are on track for a positive December, with the S&P 500 looking at its best year since 2019, showing a year-to-date rise exceeding 27%, bolstered by technology gains, Fed rate cuts, and optimism following President-elect Donald Trump's corporate policies.

Dow E-minis were down 165 points, or 0.38%; S&P 500 E-minis down 16.25 points, or 0.27%; and Nasdaq 100 E-minis down 13.75 points, or 0.06%.

Crypto stocks continued to climb as bitcoin surpassed $107,000. Miners Hut 8, MARA Holdings, and Riot Platforms (NASDAQ:RIOT) all saw gains of over 2%.

Albertsons Companies (NYSE:ACI) rose 1% after multiple brokerages increased their price targets, with Telsey Advisory Group upgrading it to "outperform" from "market perform."