Stock futures slightly higher with Fed set to kick off September meeting on Tuesday

Stock futures slightly higher with Fed set to kick off September meeting on Tuesday

Equity futures rose slightly on Tuesday morning as Wall Street looked to take advantage of a modest rally ahead of another rate hike by the Federal Reserve.

Futures linked to the Dow Jones Industrial Average rose 61 points, or 0.2%. S&P 500 futures were up 0.22% and Nasdaq 100 futures were up 0.27%.

The Federal Open Markets Committee kicks off its September meeting on Tuesday and central bankers are expected to announce a 0.75 percentage point rate hike on Wednesday. Stocks have fallen in recent weeks as comments from Fed Chairman Jerome Powell and an unexpectedly positive August consumer price index report had traders bracing for even higher rates until inflation cool down

“I think a lot of work was done last week to reset interest rate expectations,” said Angelo Kourkafas, investment strategist at Edward Jones.

“The momentum in equity markets is down…Until we establish that pattern of lower [inflation] readings, it’s going to be difficult to reverse the heightened uncertainty and volatility that we’re seeing,” Kourkafas added.

During a choppy trading session on Monday, stocks rallied in the afternoon to snap a two-day losing streak and recoup some of their recent losses. The Dow rose 197 points, or about 0.6%. The S&P 500 and the Nasdaq Composite gained about 0.7% and 0.8%, respectively.

However, after the market closed on Monday, Ford announced that supply chain issues would cost the automaker an additional $1 billion in the third quarter. Shares fell 4.5% in extended trading.

On the economic front, investors will get a fresh look at the housing market on Tuesday morning with the August reports on housing starts and building permits.

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