By Angika Biswas and Lisa Palin Mattakal
(Reuters) – The Nasdaq was higher at the open on Tuesday as Nvidia and other AI-linked stocks rose after a bruising sell-off, while investors awaited further clues on the monetary policy path this week based on Federal Reserve officials and economic data.
AI chip maker Nvidia advanced 2.5% before opening hours after losing nearly 13% of its market value and $430 billion over the past three trading days.
Peers Micron Technology, Broadcom and Qualcomm rose 1% each, while AI-optimized server maker Super Microcomputer rose 2%.
The tech-heavy Nasdaq fell more than 1% on Monday as investors pulled out of AI-linked stocks in favor of other sectors.
Earlier in the week, investors bought into sectors including utilities and energy, which have underperformed technology and technology-adherent stocks this year.
However, futures tracking the Dow fell after the blue-chip index hit a one-month high on Monday.
Technology and other growth stocks have led the S&P 500 and Nasdaq to record highs this year, but the value-focused Dow continues to lag other indexes significantly, raising concerns about the sustainability of some equity strength.
“The question investors need to ask now is, with the stock (NVIDIA) in correction territory, has the selloff gone far enough, or is it less of a structural shift that will allow other regions to weigh on key U.S. indices and indices to underperform,” said Kathleen Brooks, director of research at XTB. .
Data on the Personal Consumption Expenditure (PCE) price index – the central bank’s preferred inflation gauge – tops Friday’s watch list, while investors will keep an eye on consumer confidence data later in the day.
Federal Reserve Governor Michelle Bowman said she did not yet foresee any cuts in US benchmark interest rates this year.
Market participants see 61% odds on a 25-basis-point interest rate cut in September, according to LSEG’s FedWatch data.
Also scheduled for the day are Carnival Corp. before markets open and parcel delivery company FedEx after the bell to share a portion of quarterly corporate earnings.
At 8:26 a.m. ET, the Dow e-minis were up 41 points, or 0.1%, the S&P 500 e-minis were up 11.5 points, or 0.21%, and the Nasdaq 100 e-minis were up 86.25 points, or 0.44%.
Among others, Spirit Aerosystems fell 3.4%. Boeing has offered to buy the aircraft fuselage maker in an equity-financed deal that values its key supplier at about $35 a share, a report showed. Boeing shares fell 1.2%.
Trump Media & Technology Group rose 11% and was set to extend Monday’s strong gains. The company announced that it expects $69.4 million in proceeds from cashing out the warrants.
(Reporting by Angika Biswas and Lisa Mattakal in Bengaluru; Editing by Shaunak Dasgupta and Maju Samuel)
