US stock futures dip amid Uber's weak outlook, Fed Clarity Hunt

US stock futures dip: In anticipation of a lower opening, US stock index futures retreated on Wednesday, impacted by Uber's disappointing forecast and a resurgence in bond yields, as investors sought clarity regarding the Federal Reserve's stance on interest rate adjustments.

Uber's premarket stumble of 7 per cent followed its projection of second-quarter gross bookings below market expectations, weighing down on investor sentiment. Concurrently, megacap stocks like Tesla, Amazon.com, and Alphabet also experienced declines ranging from 0.6 per cent to 1.7 per cent, exacerbated by an uptick in the 10-year Treasury yield after five consecutive days of decline.

This market movement followed the S&P 500's fourth consecutive session of gains on Tuesday, marking its most robust winning streak since March. Similarly, the Dow registered its fifth consecutive positive session, the longest streak since December 2023.

May has witnessed predominantly bullish trading, as investors found solace in a buoyant earnings season and a recent labour market report indicating softer-than-expected figures, thus alleviating concerns about prolonged high interest rates.

According to the CME Group's Fedwatch tool, traders are now factoring in a 65 per cent probability of a US central bank rate cut of at least 25 basis points in September, up from approximately 54 per cent a week ago.

Dylan Kremer, Chief Investment Officer at Certuity, noted, "The market has now priced in the Fed's move for the rest of the year, so the reaction function will be lower moving forward, and investors will start to focus more on the economic and earnings backdrop."

Investor attention is directed towards forthcoming comments from Fed representatives, including Vice Chair Philip Jefferson, Boston President Susan Collins, and Governor Lisa Cook, for insights into the central bank's monetary easing strategy.

With the earnings season nearing its conclusion and limited economic reports anticipated this week, market participants eagerly await next week's consumer price index data to assess inflation trends.

Amidst the market fluctuations, Lyft soared 5.1 per cent after projecting higher-than-expected gross bookings and a core profit for the ongoing quarter.

Meanwhile, Reddit surged nearly 12.3 per cent after signalling a potential adjusted profit in the second quarter, buoyed by robust advertising revenue and content-licensing deals with AI firms.

On the flip side, Rivian stumbled 5.3 per cent after maintaining a 2024 production outlook below Wall Street estimates and reporting a wider-than-anticipated first-quarter loss.

(with Reuters inputs)