Wall Street eyes muted open as earnings disappoint, eyes on Fed By Reuters

By Devik Jain

(Reuters) -U.S. stock index futures were largely subdued on Tuesday after a slew of underwhelming earnings reports, while investors braced for a big interest rate hike by the Federal Reserve this week to tame surging prices.

Pfizer Inc (NYSE:) slipped 1.1% in premarket trading as the drugmaker maintained sales forecasts for its COVID-19 products for the first time since launching its coronavirus vaccine.

Paramount Global slid 3.1% as it missed revenue estimates, hurt by weaker TV advertising sales.

Estee Lauder (NYSE:) Cos Inc slumped 9.3% after the cosmetics maker cut its full-year profit forecast due to fresh COVID-19 restrictions in China and the Russia-Ukraine crisis.

The U.S. central bank kicks off its two-day policy meeting on Tuesday, with traders seeing a 93.9% chance of a 50 basis points hike. Focus is squarely on Fed Chair Jerome Powell’s press conference on Wednesday for comments on the future path of interest rates and balance sheet reduction.

“The outlook may be more important than what they do. The Fed is in a position where they’re behind on inflation, so if things don’t start to slow down they will have to move more aggressively,” said Randy Hare, director of equity research at Huntington National Bank.

The benchmark hovered at 3%, having pushed above the key psychological level on Monday for the first time since late 2018. [US/]

Uncertainty around Fed’s policy move, mixed earnings from some Big Tech companies, the conflict in Ukraine and pandemic-related lockdowns in China hammered Wall Street in April.

The tech-heavy Nasdaq slumped nearly 13.3% last month, its worst monthly performance since October 2008 as richly valued high growth stocks came under pressure from rising rates.

Barring Amazon.com (NASDAQ:), megacap growth stocks such as Tesla (NASDAQ:) Inc and Meta Platforms edged higher.

JP Morgan Chase (NYSE:) & Co rose 0.5% to lead gains among the big banks.

At 8:29 a.m. ET, remained unchanged, were up 1.25 points, or 0.03%, and were up 8.25 points, or 0.06%.

DuPont de Nemours (NYSE:) fell 1.8% after the industrial materials maker cut its annual sales and earnings forecast to reflect higher raw material and logistics costs.

Western Digital Corp (NASDAQ:) jumped 10.1% after activist investor Elliott Investment Management urged the company to separate its Flash business and offered to invest $1 billion to facilitate a sale or a spin-off of the business.