news/AAPL/2023.01.30/Wall Street set to open lower ahead of Fed rate decision.txt

(For a Reuters live blog on U.S., UK and European stock
markets, click or type LIVE/ in a news window.)*Megacap growth stocks lead declines*Fed decision on interest rates on Wednesday*Futures down: Nasdaq 1.13%, S&P 0.80%, Dow 0.46%Jan 30 (Reuters) - Wall Street was set to open lower on
Monday, with the tech-focused Nasdaq futures dropping more than
1%, at the start of the busiest week of the earnings season and
ahead of key central bank meetings.The U.S. Federal Reserve is seen hiking the Fed funds rate
by 25 basis points (bps) at the end of its two-day policy
meeting on Wednesday, close on the heels of economic reports
showing signs of slowing demand and cooling inflation.This will likely be the smallest rate increase since the Fed
kicked off its tightening cycle 10 months ago with a 25 bps
hike, with financial markets pricing in a final rate hike in
March."The Fed's going to continue to err on the side of caution
with respect to inflation because of the fact that it still
remains well above the 2% target ... we're seeing signs that
inflation may be coming down, but it's still not low enough,"
said Adam Sarhan, chief executive of 50 Park Investments in New
York.Money markets now see rates peaking at 4.9% in June, still
below the 5% level expected by Fed policymakers.After a slew of layoffs by large-cap tech and financial
firms through the month, investors will now watch out for the
Labor Department's January nonfarm payrolls data expected on
Friday.A total of 107 S&P 500 firms are expected to report
quarterly earnings this week including heavyweight growth
companies Apple Inc, Amazon.com Inc, Alphabet
Inc and Meta Platforms Inc, all down about 1%
each in premarket trading.Analysts expect S&P 500 earnings during the fourth-quarter
to decline 2.9%, compared with the 1.6% drop expected at the
beginning of the year, according to Refinitiv data as of Friday.Data reflecting cooling inflation and a slowing economy has
raised hopes among investors that the Fed might steer away from
its hawkish rhetoric, stoking interest in growth stocks this
month, with the S&P 500 Growth index recouping more than
half its monthly losses from December.Tighter monetary policies have stood in the way of business
expansion of growth firms, which have also been pressured for
much of last year by high Treasury yields.Wall Street is expected to end the month higher with the
tech-inclined Nasdaq and the benchmark S&P 500
recovering December losses."The month of January was a big 'up-month' on Wall Street,
led mostly by many of the big stocks that got crushed last
year," Sarhan added, noting that the decline in growth stocks on
Monday could be due to some profit-taking.At 8:48 a.m. ET, Dow e-minis were down 157 points,
or 0.46%, S&P 500 e-minis were down 32.5 points, or
0.8%, and Nasdaq 100 e-minis were down 138 points, or
1.13%.Other major central banks including the European Central
Bank and the Bank of England are also seen raising interest
rates later in the week.
(Reporting by Shreyashi Sanyal and Johann M Cherian in
Bengaluru
Editing by Vinay Dwivedi)