Traders work on the floor of the New York Stock Exchange (NYSE) on the first day of trading of the new year on January 02, 2025 in New York City.
Spencer Platt | Getty Images
U.S. stock futures ticked higher on Tuesday night. The action comes after a sharp decline in Big Tech stocks and renewed fears over the path of rate cuts spurred a sell-off on Wall Street.
S&P 500 futures rose 0.1%, while Nasdaq 100 futures gained 0.2%. Futures tied to the Dow Jones Industrial Average advanced 38 points, or roughly 0.1%.
Stocks were under pressure during Tuesday’s regular session, as all three major averages finished solidly in the red on the heels of new data on the state of the U.S. services industry. For December, the Institute for Supply Management’s services index showed an acceleration of activity in the space.
That said, the ISM reading also showed an increase in prices on the month, fanning concerns around stubborn inflation and raising questions around this year’s trajectory of interest rate cuts from the Federal Reserve. According to the CME’s FedWatch tool, fed funds futures trading data reflect a 95% chance of no reductions at the central bank’s meeting this month.
On Tuesday, the Nasdaq Composite led the pack in losses, dropping nearly 2%. The broad market S&P 500 and blue-chip Dow Jones Industrial Average, which slid more than 1% and around 0.4%, respectively.
Nvidia led the losses in tech in the session, falling more than 6%. Tesla and Meta Platforms tumbled 4% and almost 2%, respectively.
The December ISM data also spurred a spike in Treasury yields Tuesday, sending the rate on the benchmark 10-year note to an intraday high of 4.699%. That marks its highest level since April.
Ayako Yoshioka, a portfolio consulting director at Wealth Enhancement Group, thinks the positive story for the market is still intact for 2025, even if the path to “decent” returns is more volatile, as she expects.
“We have so many different crosscurrents, whether it’s on the growth side, the inflation side, policy changes,” Yoshioka said Tuesday on CNBC’s “Closing Bell.” “Those are going to probably rattle markets at times, but I think they’re going to be overall just buying opportunities in the long term.”
Investors are now looking ahead to the ADP private payrolls report and jobless claims data. Both are due Wednesday morning. Minutes from the Fed’s December meeting are slated for release at 2 p.m. ET.