US stock futures edge lower ahead of Fed commentary

Futures tied to Wall Street's main indexes fell marginally on Tuesday as investors awaited commentary from Federal Reserve officials through the day to assess the impact of U.S. President Donald Trump's tariff policies into the second half of 2025.

At least seven Fed officials including St. Louis Fed President Alberto Musalem are expected to speak later in the day.

Traders currently expect at least two 25-basis-point rate cuts from the U.S. Federal Reserve by the end of the year, with the first expected in September, according to data compiled by LSEG.

Fed officials on Monday flagged the ramifications of the latest downgrade of the U.S. government's sovereign credit rating and uneasy market conditions.

At 06:54 a.m. ET, Dow E-minis (YMcv1) were down 2 points, or flat, S&P 500 E-minis ES1! were down 15.5 points, or 0.26%, and Nasdaq 100 E-minis NQ1! were down 79.75 points, or 0.37%.

Among early premarket movers, retailer Home Depot HD gained 3% after beating Wall Street estimates for first quarter sales.

Amer Sports AS jumped nearly 10% after raising its 2025 revenue forecast.

Most megacap and growth stocks were tracking lower, with Nvidia NVDA and Amazon.com AMZN down about 0.3% each.

Stocks initially fell on Monday while government bond yields jumped as investors assessed the implications of Moody's downgrading the U.S. sovereign credit rating to "Aa1" from a pristine "Aaa", citing the government's $36-trillion outstanding debt and interest.

Treasury yields continued to decline, with those on the 10-year Treasury note US10Y last down 1.4 bps on Tuesday to 4.46%.

"Yesterday's price action does not alter the bullish hypothesis nor alter our thinking that many investors would prefer to be long or flat into Nvidia earnings," J.P.Morgan analysts said in a note.

"Any weakness from either a weaker flash PMI print or consumer-sector earnings we think should be bought."

Nvidia NVDA is scheduled to report quarterly earnings on May 28 and preliminary readings of the May Purchasing Managers Index are due later in the week.

Concerns around mounting U.S. debt remained in focus, with a vote on Trump's sweeping tax-cut bill in the House of Representatives expected sometime this week.

U.S. stocks have had a solid month so far, with the S&P 500 now more than 17% higher than its April lows, when global markets were jolted by Trump's reciprocal tariffs on most trading partners.

A pause in the tariffs, a temporary trade truce between the U.S. and China and some tame inflation data have pushed equities higher, although the S&P 500 is still about 3% away from its record highs.