Economic news

Futures Dip, Inflation in Focus; Tesla Gains on China Sales

U.S. stock index futures fell on Tuesday as investors stepped back ahead of key inflation data later in the week, while Tesla gained on strong sales in China, a major market for the electric carmaker.

Tesla’s shares rose 2.6% in premarket trade after sales of its China-made electric vehicles surged 29% in May, data showed.

Major technology stocks were trading slightly lower, as investors digested the possible impact a global plan to increase taxes on major multinational firms.

Shares of Clover Health Investments Corp and other “meme stocks” surged as small-time individual investors piled into some of the most heavily shorted U.S. stocks.

Social media darlings AMC Entertainment and GameStop also extended their rally into a third week.

Still, Wall Street appeared to have fallen into a lull at the end of a strong earnings season, marking a slow start to the week on Monday.

Investors were now awaiting further cues on policy tapering from the Federal Reserve after what is expected to be a strong inflation reading on Thursday.

The U.S. economy is set for a sharp bounceback from a COVID-induced slump, with recent inflation data indicating as much. But the labor market- a key factor for the Fed to consider tapering policy - has stalled in its recovery.

The Fed’s monetary policy meeting next week is also expected to shed more light on its stance.

Private equity firm KKR & Co gained 1.2% after its unit, Independence Energy LLC, and Contango Oil & Gas Co said they will merge in an all-stock deal that would create an oil and gas company with an initial equity market capitalization of about $4.8 billion.

At 6:29 a.m. ET, U.S. E-minis stocks futures were down 0.24% at 4,215.5 points. Dow E-minis were down 140 points, or 0.4%, while Nasdaq 100 E-minis were down 8.75 points, or 0.06%.

Reporting by Ambar Warrick and Shashank Nayar in Bengaluru; Editing by Maju Samuel

Source: Reuters

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