Futures slip on caution ahead of business activity data, geopolitical tensions

(Reuters) – U.S. stock index futures slipped on Friday as investors remain cautious ahead of a business activity survey and increasing geopolitical tensions between Ukraine and Russia, but Wall Street’s main indexes were poised for weekly gains.

The benchmark S&P 500 and blue-chip Dow closed Thursday at one-week highs, with AI bellwether Nvidia managing modest gains after its quarterly forecast, while investors took comfort from robust economic data. In premarket trading on Friday, Nvidia dropped 0.8%.

Market attention is now focused on a S&P business activity survey due at 9:45 a.m. ET, with forecasts pointing to services activity still in expansion territory, while manufacturing is expected to remain in contraction.

At 05:42 a.m. ET, Dow E-minis were down 82 points, or 0.19%, S&P 500 E-minis slipped 16 points, or 0.27%, and Nasdaq 100 E-minis fell 81.25 points, or 0.39%.

Wall Street’s main indexes are on track to end the week higher, with sentiment still strong about the positive implications Donald Trump’s tax and tariff policies could have for corporates after his win in the presidential election.

Futures tracking small caps inched up 0.1% and the Russell 2000 index was set for weekly advances of 2%.

However, expectations on the Federal Reserve’s policy move in December have recently swayed between a pause and a cut, as investors weigh the impact Trump’s policies can have on price pressures.

There is a 59.1% probability the central bank will lower borrowing costs by 25 basis points, as per the CME Group’s FedWatch Tool.

Comments from Federal Reserve Board Governor Michelle Bowman will also be parsed later in the day.

Markets were also monitoring a missile exchange between Ukraine and Russia after the latter lowered its threshold for a nuclear retaliation earlier in the week. Energy stocks are the most sensitive to geopolitical risks and have gained over 2% this week.

Among top movers, Gap Inc jumped 14.7% after the Old Navy parent raised its annual sales forecast and said the holiday season was off to a “strong start”.

Alphabet dipped 0.4% and Amazon.com slipped 0.2%.

On Thursday, the Google parent slid after prosecutors argued it was monopolizing online search, while a report said Europe will start an investigation next year into whether Amazon favors its own brand products on its online marketplace.

Crypto stocks were mixed, with bitcoin trading shy of $100,000. MicroStrategy added 2%, while Riot Platforms dipped 0.5%.

Speculations were rife about who could be the Treasury Secretary in the Trump cabinet, with a report saying the president-elect floated the idea of appointing Kevin Warsh on the understanding he could later be Federal Reserve Chairman.

(Reporting by Johann M Cherian in Bengaluru; Editing by Krishna Chandra Eluri)