Stock index futures edge up as rate cuts seem imminent; eyes on Nvidia earnings

The major market averages were mixed on Monday, after Wall Street rallied on Friday with rate cuts seeming imminent. Investors are now geared up for Nvidia (NVDA) earnings scheduled for later in the week.

Early on and the S&P 500 (SP500) was near flat, the Nasdaq (COMP:IND) was -0.6%, and the Dow (DJI) was +0.4%.

The 10-year Treasury yield (US10Y) was down 1 basis point to 3.78%. The 2-year yield (US2Y) was lower by 2 basis points to 3.89%.

Major U.S. equity averages closed higher Friday, cementing a winning week for stocks as Federal Reserve Chair Jerome Powell said the central bank is set to start cutting interest rates from a two-decade high.

“Powell’s statements that ‘the time has come for policy to adjust’ and ‘the direction of travel is clear’, leave little doubt that further rate cuts will follow the first easing in September. Better late than never,” Pantheon Macroeconomics said.

In short, the inflation pipeline is very benign, and the hard inflation data will continue to catch up to this reality. The Fed now has to catch up too, Pantheon Macro added.

AI-darling Nvidia (NVDA) will release its second quarter earnings on Wednesday, after the close.

Traders will also keep a watch on the July personal consumption expenditure- the Fed’s preferred inflation gauge, which is expected to come at the end of the week.

Durable goods orders soared 9.9% M/M to $289.6B in July, easily topping the +4.0% expected and rebounding from a 6.9% plunge in June, the U.S. Census Department said on Monday. The previous month’s print was revised from -6.6%.

The headline number increased in five of the last six months.

The Dallas Fed manufacturing survey is also due today, during market hours.