From Nasdaq:

U.S. stock index futures fell, with Tesla dropping 1.5% in premarket trading after slashing Model Y car prices in Germany. Wall Street’s over-13% rally in the last two months of 2023 is losing steam amid continued pushback from policymakers on expectations for an early start to interest-rate cuts. The global risk appetite is down, and market fear gauge VIX rose to a two-month high.

Traders maintain hopes for a 61% probability of a 25 basis point rate cut by the U.S. Federal Reserve in March, down from over 80% at the end of 2023, according to the CME Group’s FedWatch Tool. On tap today, December retail sales data are expected to show a 0.4% rise, and December industrial production is forecast to see a flat reading.

Additionally, a number of Fed officials are expected to speak on Wednesday, including Fed Vice Chair for Supervision Michael Barr, Fed Board Governor Michelle Bowman, and New York Fed President John Williams. On the quarterly earnings front, reports from Charles Schwab, Citizens Financial, and US Bancorp are expected.

CEOs of investment banking giants are optimistic about a resurgence in capital markets, citing an improving U.S. economy and deals pipeline. U.S.-listed shares of Chinese firms like Alibaba, Xpeng, and Bilibili dropped between 3.3% and 7.3% after China data showed the local economy’s recovery was shakier than expected. Spirit Airlines slid 7.8% after a U.S. judge blocked JetBlue from acquiring the carrier, and Interactive Brokers fell 4.6% after posting downbeat fourth-quarter revenue. The CBOE Market Volatility Index rose to an over two-month high, at 14.60 points.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Additionally, for a Reuters live blog on U.S., UK, and European stock markets, click LIVE/ or type LIVE/ in a news window. At 5:35 a.m. ET, Dow e-minis were down 161 points, or 0.43%, S&P 500 e-minis were down 22.5 points, or 0.47%, and Nasdaq 100 e-minis were down 97 points, or 0.57%.



Read more: US STOCKS-Futures slip as rate-cut uncertainty looms; Tesla drops