Investing.com -- U.S. stock index futures edged higher Tuesday amid caution at the start of a Federal Reserve meeting and with earnings from some of the country’s biggest companies due.
At 06:00 ET (10:00 GMT), Dow Jones Futures rose 57 points, or 0.1%, S&P 500 Futures climbed 10 points, or 0.2%, and Nasdaq 100 Futures gained 19 points, or 0.1%.
Fed meeting awaited for more rate cues
Markets are on edge with the latest Fed meeting set to start later Tuesday, to be concluded on Wednesday.
The U.S. central bank is widely expected to keep interest rates unchanged, but after a benign June inflation report, investors will be looking for Fed Chair Jerome Powell to lay the groundwork for a September rate cut.
Fed officials have repeatedly stated that they are looking for more evidence that inflation is steadily returning to 2% before cutting rates, but Powell indicated earlier this month that the central bank may not wait until inflation reaches this target before cutting rates.
Markets have fully priced in a 25 basis point cut in September, with a small chance of a reduction of 50 basis points, and have 66 basis points of easing priced in by the end of the year.
Microsoft to kick off next round of major tech earnings
There are more key earnings to digest this week, starting with Microsoft (NASDAQ:MSFT) reporting its June quarter earnings after the bell on Tuesday.
While the firm is set to report strong growth in earnings on the back of more artificial intelligence products, investors will be watching for any increased expenditure, and whether AI demand appeared to be sufficiently boosting earnings.
The increased caution comes after high AI spending and some sluggish revenue metrics soured otherwise strong earnings from peer Alphabet (NASDAQ:GOOGL) last week.
Beyond Microsoft, tech heavyweights Meta Platforms (NASDAQ:META) and Apple (NASDAQ:AAPL) are set to report earnings on Wednesday and Thursday, respectively.
Other major earnings due Tuesday come from the likes of Advanced Micro Devices (NASDAQ:AMD), Merck (NYSE:MRK), Procter & Gamble (NYSE:PG) and Pfizer (NYSE:PFE).
Labor market data due
There are a lo of data releases centered about the labor market this week, starting later Tuesday with job openings data for the month of June.
The major number is the monthly nonfarm payrolls for July on Friday, which is expected to show the U.S. economy created 177,000 jobs in July, moderating from 206,000 in the prior month.
This release will be under heightened scrutiny as investors try to gauge whether recent signs of cooling in the labor market continued in July, potentially impacting when the Fed starts cutting rates.
Crude edges lower
Crude prices edged lower Tuesday, trading near two-month lows on continuing concerns about demand in China, the world's largest crude importer, while traders shrugged off the risk of conflict escalating in the Middle East.
By 06:00 ET, the U.S. crude futures (WTI) dropped 0.2% to $75.70 a barrel, while the Brent contract fell 0.2% to $78.92 a barrel.
Traders were seen pricing out a risk premium from crude after media reports said Israeli officials were not seeking all-out war with Lebanon in their retaliation for a rocket strike that killed 12 in Israel-occupied Golan Heights.
The Organization of Petroleum Exporting Countries meets later in the week to discuss output levels, although recent weakness in crude is likely to see the cartel downplay any plans for scaling back production cuts.
(Ambar Warrick contributed to this article.)