Dow Jones, S&P 500 and Nasdaq futures are currently pointing to a roughly flat open on Tuesday, with stocks likely to show a lack of direction following the weakness seen in the previous session.
Traders may be reluctant to make significant moves ahead of the release of the minutes of the Federal Reserve’s latest monetary policy meeting this afternoon.
The minutes of the Fed’s December meeting, when the central bank decided to lower interest rates by another quarter point, may provide further insight about officials’ divergent views about the likelihood of further rate cuts in the new year.
While the Fed is widely expected to leave interest rates unchanged at its next meeting in late January, rates are expected to be at least another quarter point lower by the end of 2026, according to CME Group’s FedWatch Tool.
On the heels of the Christmas holidays last week, some traders may also remain away from their desks ahead of the New Year’s Day holiday on Thursday.
After turning in a strong performance last week, stocks moved mostly lower during trading on Monday. The major averages all moved to the downside, although selling pressure was somewhat subdued.
The major averages ended the day well off their worst levels but still in negative territory. The Dow fell 249.04 points or 0.5 percent to 48,461.93, the Nasdaq slid 118.75 points or 0.5 percent to 23,474.35 and the S&P 500 declined 24.20 points or 0.4 percent to 6,905.74.
The pullback on Wall Street may have reflected profit taking, as some traders looked to cash in on recent gains going into the end of the year.
Partly reflecting renewed strength among tech stocks, the Dow and the S&P 500 ended last Wednesday’s trading at record closing highs before edging slightly lower last Friday.
The major averages all posted strong gains for the Christmas-interrupted week. While the S&P 500 shot up by 1.4 percent, the Dow and the Nasdaq both jumped by 1.2 percent.
A pullback by big-name tech companies is also weighing on the markets, with Nvidia (NASDAQ:NVDA) and Oracle (NYSE:ORCL) showing notable moves to the downside.
Overall trading activity appeared somewhat subdued, however, as some traders remained away from their desks ahead of the New Year’s Day holiday on Thursday.
On the U.S. economic front, a report released by the National Association of Realtors showed pending home sales in the U.S. shot up by much more than expected in the month of November.
NAR said its pending home sales index spiked by 3.3 percent to 79.2 in November after surging by 2.4 percent to an upwardly revised 76.7 in October.
Economists had expected pending home sales to climb by 0.8 percent compared to the 1.9 percent jump originally reported for the previous month.
Gold stocks saw substantial weakness amid a sharp pullback by the price of the precious metal, with the NYSE Arca Gold Bugs Index plunging by 5.7 percent after ending last Friday’s trading at a record closing high.
Significant weakness was also visible among airline stocks, as reflected by the 1.6 percent loss posted by the NYSE Arca Airline Index.
Computer hardware, steel and banking stocks also saw notable weakness, while oil producer stocks moved to the upside amid a spike by the price of crude oil.