US stock futures slipped on Friday as investors turned cautious ahead of Federal Reserve Chair Kevin Warsh’s Jackson Hole speech, seeking clues on the interest-rate path. The AI-led rally paused, with Nvidia, Micron Technology, and Intel declining in premarket trading.
The AI-driven rally showed signs of cooling as Nasdaq 100 futures slipped 0.30%, while Dow futures were up 0.03% and S&P 500 futures declined 0.05%. Investors are closely watching Warsh’s speech for insights into the Fed’s policy path amid mixed inflation data and renewed warnings from central bank officials.
Marvell Technology's shares tumbled 6.9% as investors questioned the timing of revenue from its AI chip agreement with Alphabet’s Google, despite an increased 2027 revenue forecast. PayPal saw a significant drop of 15.4% following reports that a consortium involving Advent and Stripe had abandoned its pursuit of the payments company.
Chip stocks retreated after Nvidia's strong forecast had fuelled gains in the previous session. Nvidia fell 0.5%, while Micron Technology and Intel declined 1.8% each. Investors are seeking fresh catalysts for the semiconductor sector as markets assess the potential revenue benefits from data-centre investment.
Gap shares jumped 14.2% after the retailer appointed Michael Francis as Old Navy’s new CEO and raised its annual profit forecast. Investors will also assess the final University of Michigan consumer sentiment reading for August and a speech from Chicago Fed President Austan Goolsbee.
Warsh’s speech is attracting particular attention as investors assess whether the Fed could tighten policy if inflation fails to ease. Three Fed officials issued inflation warnings on Thursday, with at least two returning to a rate-hike stance. Money markets were pricing a 35.9% probability of a September rate hike, according to CME’s FedWatch tool.
Background
The Jackson Hole Economic Symposium is a significant event where central bankers, finance ministers, and academics discuss economic issues. This year's focus is on inflation and interest rates, with investors eager to gauge the Fed's future policy direction.
As markets weigh inflation risks against the need to preserve policy flexibility, investors will be keenly watching the central bank’s messaging. The outcome of Warsh’s speech could significantly influence market movements in the coming weeks.
