Stocks Poised for Lower Open: Market Nerves and Economic Uncertainties Weigh In

As the Federal Reserve Open Market Committee (FOMC) meeting kicks off on Tuesday, January 13, 2025, market sentiment is subdued, with stock futures indicating a slightly lower opening. The Bank of Japan's decision to abandon its negative interest rate policy earlier in the day has contributed to market jitters ahead of the Fed's decision. With no major catalysts driving the market, pre-Fed session nerves may keep sentiment subdued.

Interest-rate concerns seem to be impacting market sentiment, as investors await the Fed's decision on Wednesday. The Fed's recent minutes, released on Tuesday, showed officials expected to dial back the pace of interest rate cuts this year in the face of persistently elevated inflation and the threat of widespread tariff increases under President-elect Donald Trump and other potential policy changes. This uncertainty may contribute to market volatility and a lower open.

The Fed's staff economists considered the U.S. economy's future path particularly uncertain at the December meeting, in part because of the incoming Trump administration's "potential changes to trade, immigration, fiscal, and regulatory policies." Attention is focused on a U.S. non-farm jobs report due from the Labor Department later in the day, which may provide further insight into the economy's health.

In the premarket trading on Tuesday, the SPDR S&P 500 ETF Trust (SPY) slipped 0.36% to $51, and the Invesco QQQ ETF (QQQ) fell 0.53% to $435.14, according to Benzinga Pro data. The Dow Jones Industrial Average (DJIA) futures were down 0.21%, while the Russell 2000 (R2K) futures slipped 0.34%.



The upcoming economic data, including the housing starts report for February, may also influence market sentiment. Economists expect housing starts to come in at a seasonally adjusted annual rate of 1.43 million units, up from 1.33 million units in January. Building permits, a measure of future housing activity, may have come in at 1.49 million units, slightly up from 1.47 million units in the previous month.



In the premarket trading, General Mills (GIS) shares fell 4% after trimming its outlook for 2025. Jabil (JBL) stock surged nearly 10% on stronger-than-expected fiscal first quarter earnings and guidance. Nvidia (NVDA) shares rose nearly 3% after four straight losing sessions, exiting correction territory. Coinbase Global (COIN) and Robinhood Markets (HOOD) fell in premarket trading amid the slide in cryptocurrencies. Fusion Pharmaceuticals Inc. (FUSN) shares nearly doubled after the biotech clinched a buyout deal with AstraZeneca plc (ANZ).

As the market awaits the Fed's decision and the release of economic data, investors may remain cautious, leading to a lower open on Tuesday. The uncertainty surrounding the Fed's reaction to mixed economic data and the potential impact of President-elect Trump's policies on the economy may also contribute to market volatility.