August 29 – Wall Street futures slipped on Friday as investors turned cautious ahead of a key inflation report that could influence the Federal Reserve’s decision on interest rates in September. Dow Jones Industrial Average futures were down 0.33%, S&P 500 futures fell 0.33%, and Nasdaq 100 futures dropped 0.53%, reflecting a broad-based pullback across markets.
The decline was most evident in technology stocks, with Dell Technologies and Marvell Technology leading the losses after both companies issued weaker-than-expected forecasts. Dell (DELL.N) fell more than 6% in premarket trading, while Marvell (MRVL.O) plunged nearly 14%, dragging the tech-heavy Nasdaq lower. Their results raised concerns about a slowdown in demand for hardware and networking equipment after a strong run in 2023.
Nvidia (NVDA.O) also came under pressure, slipping close to 2% following cautious remarks about its China business. Investors were unsettled by the warning, given how crucial the Chinese market is for the company’s growth. However, optimism from CEO Jensen Huang, along with better-than-expected quarterly results, helped ease worries about any near-term slowdown in the broader artificial intelligence sector. The reassurance from Nvidia supported other AI-related and mega-cap technology names, which had powered Thursday’s rally that drove the Dow and S&P 500 to record closing highs.
With corporate earnings largely digested, investors are now focused on the release of the Personal Consumption Expenditures index, the Fed’s preferred inflation measure, due at 8:30 a.m. ET. Economists expect the headline figure to hold steady at 2.6% in July, the same as the previous month. However, the core reading, which strips out volatile categories such as food and energy, is projected to tick higher to 2.9% from 2.8%.
Market analysts say that while inflation has not surged dramatically, the underlying signals point to renewed pressures. Seema Shah, chief global strategist at Principal Asset Management, noted that July’s inflation report was not alarmingly strong, but trends suggest costs are creeping higher as new trade tariffs add to supply-side challenges.
At around 7 a.m. ET, Dow E-minis were lower by 150 points, S&P 500 contracts were down 21.5 points, and Nasdaq 100 contracts fell 125.75 points. Despite this cautious tone, investors are still largely expecting the central bank to ease policy next month. Futures markets are pricing in an 84.2% chance of a 25-basis-point rate cut at the September meeting. That expectation was reinforced by Fed Chair Jerome Powell’s dovish comments at Jackson Hole, where he highlighted signs of labor market weakness. Governor Christopher Waller also added weight to the view by stating on Thursday that he favored beginning rate cuts in September.
Still, broader economic data continues to reflect resilience, and some observers believe the impact of U.S. tariffs has yet to be fully felt across prices. However, starting Friday, the tariff exemption that allowed imports under $800 to enter the United States without duty expired. The end of the exemption is likely to raise costs for small businesses and consumers, adding another element to the inflation debate.
Political developments surrounding the Fed also drew attention. Governor Lisa Cook filed a motion challenging efforts by President Trump to remove her from the central bank. Her motion argued that the attempt was unlawful and sought to prevent any dismissal actions until the case is resolved. The case is scheduled to be heard in court at 10 a.m. ET. The dispute heightened concerns that political interference in the Fed’s independence could affect market confidence. Bond yields climbed late Thursday on those worries, as higher yields signal reduced demand for U.S. debt and weigh on equities.
Corporate earnings and forecasts added to the cautious mood. Caterpillar, often viewed as a gauge for global economic health, fell 2.6% after warning that its tariff-related costs would rise further in 2025. The guidance underscored how trade policy shifts are filtering into industrial companies and weighing on outlooks. In contrast, Celsius Holdings surged 6.6% after reports that PepsiCo (PEP.O) planned to increase its stake in the energy drink maker through a $585 million investment. The move highlighted strong demand in the fast-growing energy beverage sector and reinforced optimism about consumer-facing brands.
Taken together, the market faces a delicate balance. Optimism about long-term growth in artificial intelligence and the expectation of rate cuts provides support, yet the risk of persistent inflation, higher tariffs, and political wrangling at the Fed keeps investors on edge. The upcoming PCE report is likely to set the tone for September trading. A reading in line with or below forecasts could spark renewed momentum, while an upside surprise might dampen hopes for aggressive monetary easing and reignite volatility.