US stock futures inch lower with Jackson Hole in focus; tech shares weak

Investing.com-- U.S. stock index futures fell slightly on Tuesday evening as Wall Street remained largely risk-averse in anticipation of more economic and central bank cues from the Jackson Hole Symposium this week.

Technology shares were the worst-hit by uncertainty over monetary policy, as investors locked-in recent profits in the sector. Reports that the U.S. government was considering taking equity stakes in major chipmakers also weighed on the sector.

S&P 500 Futures fell 0.1% to 6,427.25 points, while Nasdaq 100 Futures fell 0.2% to 23,427.0 points by 19:39 ET (23:39 GMT). Dow Jones Futures were flat at 45,000 points.

Tech shares weaken as chipmakers fall amid govt. stake speculation

Technology stocks were the worst performers on Wall Street this week, as the sector was hit with a heavy dose of profit-taking following recent gains.

Chipmakers fell sharply amid speculation that the Donald Trump administration will seek equity stakes in companies receiving CHIPS Act Funds.

Reuters reported that the commerce department was looking into more companies it could take stakes in, after Commerce Secretary Howard Lutnick said on Tuesday that the government will seek a stake in Intel Corporation (NASDAQ:INTC) over its CHIPS Act funding.

Intel’s shares had fallen sharply on this notion, but were supported on Tuesday by SoftBank Group Corp. (TYO:9984) taking a $2 billion stake in the struggling chipmaker.

Reuters reported that Lutnick was looking at stakes in companies such as Micron Technology Inc (NASDAQ:MU), TSMC (NYSE:TSM), and Samsung Electronics Co Ltd (KS:005930). Apart from Intel, Micron is the biggest recipient of CHIPS Act funding.

Artificial intelligence chip major NVIDIA Corporation (NASDAQ:NVDA) fell 3.5% on Tuesday and lost another 0.3% in aftermarket trade. Other members of the so-called Magnificent Seven group also lost ground on Tuesday.

Losses in tech dragged Wall Street lower. The S&P 500 closed down 0.6% to 6,411.46 points, while the NASDAQ Composite slid 1.5% to 21,314.95 points. The Dow Jones Industrial Average was flat at 44,922.39 points.

Wall Street was also hurt by signs of no immediate progress towards a Russia-Ukraine peace treaty, as Trump’s meetings with Russian, Ukrainian and European leaders over the past few days yielded no concrete agreements.

Jackson Hole, retail earnings in focus

Wall Street was also hit by profit-taking amid uncertainty over just what Federal Reserve Chair Jerome Powell will signal at the Jackson Hole conference this week.

Powell is set to speak on Friday, with his address coming amid growing expectations that the Fed will cut interest rates in September. These were driven by data showing some cooling in the labor market and consumer inflation,

President Trump also kept up his criticism of Powell on Tuesday, chiding the Fed Chair for being “too late” in cutting interest rates.

Powell, on the other hand, has remained non-committal towards further easing, citing caution over sticky inflation stemming from Trump’s trade tariffs.

Before Powell’s address, focus is on a host of major retailer earnings for more cues on the U.S. consumer. TJX Companies Inc (NYSE:TJX), Lowe’s Companies Inc (NYSE:LOW), and Target Corporation (NYSE:TGT), are set to report June quarter earnings on Wednesday, followed by Walmart Inc (NYSE:WMT) on Thursday.

Outside retail, Wall Street majors including Analog Devices Inc (NASDAQ:ADI), Intuit Inc (NASDAQ:INTU), and Workday Inc (NASDAQ:WDAY), are set to report earnings in the coming days.