(Reuters) – Futures tied to Wall Street’s major indexes fell ahead of jobs data due later on Wednesday as concerns persist over the health of the U.S. economy.
Wall Street’s major indexes posted their biggest one-day loss since early August on Tuesday after investors dumped technology-related stocks in a dismal start to what has been a historically weak month for U.S. equities.
Risk-off sentiment was exacerbated by data showing manufacturing activity remained in contractionary territory, nearly a month after signs of weakening labor demand sent global markets into a tailspin.
Traders are now looking to the July Job Vacancies and Labor Turnover Survey, due at 10 a.m. ET on Wednesday, for clues on the size of the Federal Reserve’s expected interest rate cut in September.
Markets see a 61% chance the U.S. central bank will cut interest rates by 25 basis points, according to CME Group’s FedWatch tool, while the probability of a 50-basis-point cut has risen to 39% from around 31% a day earlier.
Also due on Wednesday are data on factory orders for July and the Fed’s “Beige Book” survey.
At 5:30 a.m. ET, the Dow E-minis were down 82 points, or 0.20%, the S&P 500 E-minis were down 18.75 points, or 0.34%, and the Nasdaq 100 E-minis were down 100 points, or 0.53%.
Chip stocks, which have led much of this year’s rally on the back of artificial intelligence prospects, fell sharply on Tuesday, with the Philadelphia SE Semiconductor Index dropping 7.8% to post its steepest one-day drop since the COVID-19 pandemic.
Nvidia fell 0.8% in premarket trading on Wednesday after a report said the U.S. Justice Department has sent a subpoena to the artificial intelligence chip company as it deepens its investigation into the company’s antitrust practices.
A 10% drop in the previous session wiped a record $279 billion off Nvidia’s market capitalization — the biggest single-day drop in the market value of a U.S. company.
Other growth stocks, such as Tesla, lost 0.8%, Apple fell 0.9% and Microsoft fell 0.5%.
Among others, Zscaler forecast revenue and earnings for fiscal year 2025 below estimates, sending the cybersecurity company’s shares down 15%.
PagerDuty fell 15.2% after the digital operations management platform forecast downbeat third-quarter revenue, while GitLab rose 17% after the software development tools provider raised its annual revenue forecast.
(Reporting by Johann M Cherian in Bengaluru; Editing by Shounak Dasgupta)