By Peter Nurse
Investing.com - U.S. stocks are seen opening sharply lower Tuesday, with investors continuing to clobber the heavily-weighted tech sector on rising inflation worries.
At 7 AM ET (1200 GMT), the Dow Futures contract was down 165 points, or 0.5%, S&P 500 Futures traded 32 points, or 0.8%, lower, and Nasdaq 100 Futures dropped 175 points, or 1.3%.
The tech-heavy Nasdaq Composite closed sharply lower Monday, down 2.6% at the session’s low, as investors deserted the mega cap high growth stocks, which were behind much of the index’s gains over the last year.
This selloff is expected to continue Tuesday on fears that the pace of inflation will eventually lead the Federal Reserve to tighten its ultra easy monetary policy before its current guidance.
The energy sector will also be in focus as the shutdown of the nation’s biggest fuel pipeline by hackers entered its fifth day, raising concerns about price spikes heading into the summer driving season.
Colonial Pipeline said Monday it expects to "substantially" restore operational service by the end of the week, but its website was down on Tuesday as it continues to deal with the cyberattack.
Gasoline futures on the New York Mercantile Exchange dropped 0.2% to $2.1300 a gallon Tuesday, but reports already point to a shortage of supply in the southeastern United States, a region that relies heavily on the Colonial system.
U.S. crude futures traded 0.7% lower at $64.48 a barrel, and the Brent contract fell 0.6% to $67.90.
Later in the session, the Organization of Petroleum Exporting Countries will publish its monthly oil market report, while the industry body American Petroleum Institute will report its weekly inventory levels of US crude oil, petrol and distillate stocks.
In the corporate sector, the likes of Electronic Arts (NASDAQ:EA), Chesapeake Energy (NYSE:CHK), Hanesbrands (NYSE:HBI) and Palantir Technologies (NYSE:PLTR) will deliver earnings results on Tuesday.
Other companies in the spotlight, aside from the major tech stocks, include Simon Property (NYSE:SPG), which lowered its full-year profit per share forecast on Monday, and Callaway Golf (NYSE:ELY), which said demand for its products has never been higher.
The major economic data release will be the JOLTs job opening number, at 10:00 AM ET (1400 GMT), particularly after Friday’s soft April nonfarm payrolls release. This is expected to show 7.5 million openings, closing in on the record high seen in 2019.
There are also a number of speeches from Federal Reserve officials scheduled Tuesday, starting with New York Fed President John Williams (NYSE:WMB), before Lael Brainard, Raphael Bostic, Mary Daly and Patrick Harker chip in.
Additionally, gold futures rose 0.2% to $1,840.55/oz, just off a three-month high, while EUR/USD traded 0.3% higher at 1.2160.