Wall St set for mixed open, Home Depot puts focus on retail earnings

By Johann M Cherian and Sanchayaita Roy

(Reuters) -Wall Street's main indexes were set for a mixed open on Tuesday as investors assessed retailer Home Depot's earnings for insights on the health of the American consumer and awaited a key Federal Reserve conference scheduled later in the week.

Consumer spending accounts for around 70% of the total U.S. economy and traders are keen to know the impact U.S. tariffs have had on corporate forecasts and individual expenditure. Data last week showed the levies had dented consumer confidence in July.

Home Depot's shares edged up 1.8% in choppy premarket trading after the home-improvement retailer kept its annual forecasts intact, despite quarterly results missing estimates as homeowners reduced spending on big renovations in favor of smaller DIY projects.

Reports from rival Lowe's as well as big-box retailers Walmart and Target are expected later this week.

On the policy front, remarks from Fed Vice Chair for Supervision Michelle Bowman are due later in the day.

Bowman, who is under consideration for the central bank's top job when Chair Jerome Powell's term ends next year, has voiced support for at least three interest rate cuts this year, in line with President Donald Trump's calls for lower borrowing costs.

Interest rate futures point to a total of two rate cuts this year worth 25 basis points each, with the first expected in September, according to data compiled by LSEG.

"People are a bit hesitant to spend right now with the level of interest rates and some of the uncertainty created by inflation," said Robert Pavlik, senior portfolio manager at Dakota Wealth.

"Until they get clarity, hopefully in the form of fewer tariff hikes and maybe some interest rate cuts, we're probably stuck in this bit of malaise."

At 08:42 a.m. ET, Dow E-minis were up 106 points, or 0.24%, S&P 500 E-minis were down 1.25 points, or 0.02%, and Nasdaq 100 E-minis were down 25.25 points, or 0.11%.

Wall Street's main indexes have recovered since their April lows, when trade uncertainty stuck global markets, and have picked up steam following a better-than-expected earnings season and on the rate-cut expectations.

The key event this week is the Fed's annual symposium at Jackson Hole, Wyoming, from Aug. 21-23, where Powell's comments will be scrutinized for any clues on the central bank's outlook on the economy and monetary policy.

Dow component Caterpillar rose 1.7% after brokerage Evercore ISI upgraded the construction equipment maker's stock to "outperform" from "in line".

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Intel jumped 6% after the chipmaker got a $2 billion capital injection from Japan's SoftBank Group.

Palo Alto Networks surged 6.6% after the cybersecurity company forecast fiscal 2026 revenue and profit above estimates.

Medtronic said it would add two new directors to its board after Elliott Investment Management took a large stake in the medical-device maker. Shares were last down 3.6%.

Crude prices dropped 1% as traders weighed the possibility that talks between Russia, Ukraine and the U.S. to end the war in Ukraine could lead to the lifting of sanctions on Russian crude, raising supply.

(Reporting by Johann M Cherian and Sanchayaita Roy in Bengaluru; Editing by Devika Syamnath)