U.S. stock futures traded mostly flat Tuesday as investors awaited key developments from chipmaker Micron (NASDAQ:MU) and speeches by Federal Reserve officials. Optimism surrounds Micron’s report, fueled by strong demand expectations for its processors used in AI infrastructure. Meanwhile, early readings on U.S. business activity for September may offer clues on corporate momentum heading into the final weeks of Q3.
Futures hold steady
Ahead of these events, U.S. futures showed little movement. By 03:29 ET, Dow, S&P 500, and Nasdaq 100 futures were largely unchanged. Monday’s session on Wall Street saw broad gains, led by tech stocks, amplified by Nvidia’s $100 billion investment in OpenAI to expand data center capacity—a move that surprised some observers given the funding supports a customer for equipment purchases.
U.S. Treasuries came under slight pressure after several Fed officials signaled caution on additional rate cuts, pushing yields slightly higher.
Micron report in focus
Investors will look for further insight into AI-driven memory chip demand when Micron releases quarterly results after Tuesday’s market close.
In August, the company raised its fiscal Q4 revenue and adjusted profit guidance, citing strong returns from AI infrastructure memory chips. For the quarter ending August 28, Micron now anticipates revenue of $11.2 billion, plus or minus $100 million, up from a previous estimate of $10.7 billion, plus or minus $300 million. Adjusted gross margin is expected around 44.5%, versus prior guidance of 42%.
Chief Business Officer Sumit Sadana said pricing trends have been “robust” and the company has had “great success in being able to push that pricing up.”
Flash PMIs on the calendar
Economic watchers are turning to preliminary U.S. business activity figures for September. Economists forecast S&P Global’s composite PMI will match August’s 54.6. Manufacturing is projected to ease slightly to 52.2 from 53.0, while services may dip to 54.0 from 54.5. A reading above 50 indicates growth.
Eyes on Powell
ING analysts highlighted that “what should get attention” are public remarks by Fed officials, particularly Chair Jerome Powell.
Following last week’s 25-basis-point rate cut, debate remains over future Fed policy. While some officials see no need for further cuts this year, newly appointed Governor Stephen Miran urged more aggressive reductions, echoing President Donald Trump’s repeated calls for lower rates to support the economy.
Markets currently price a roughly 90% probability of a 25-basis-point cut in October and about 75% for another cut in December, according to CME’s FedWatch Tool.
Oil drifts lower
Oil prices slid amid ongoing oversupply concerns after Iraq and Kurdish regional governments reached a preliminary agreement to restart a pipeline.
By 03:30 ET, Brent futures fell 0.4% to $66.32 a barrel, while WTI dropped 0.3% to $62.08 a barrel, both marking a fifth straight session of declines.
The deal, reported by Reuters, could allow around 230,000 barrels per day of exports from Iraqi Kurdistan to resume, suspended since March 2023. The International Energy Agency noted in its latest monthly report that global oil supply is expected to rise faster this year, with surpluses potentially expanding in 2026 as OPEC+ production and non-OPEC output increase.
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