March 5 (Reuters) - U.S. stock index futures dipped on Tuesday as investors awaited a slew of economic data and several key events this week, including appearances from Federal Reserve Chair Jerome Powell.
An AI-fueled rally on Wall Street ran out of steam at the start of this week as focus turns to fresh cues on the Fed's monetary policy path after signs of sticky inflation in February dampened hopes of early interest rate cuts.
The benchmark S&P 500 (.SPX), opens new tab hit a fresh intraday record high on Monday before closing slightly lower in the run up to Powell's testimony before lawmakers on Wednesday and Thursday.
"In this testimony, Powell will likely ask for more patience regarding the timing of the first rate cut, he will probably say that inflation is on the right path but that they don't want to lower their guard too early," said Ipek Ozkardeskaya, a senior market analyst at Swissquote Bank.
A reading on the U.S. services sector for February and factory orders data for January due at 10:00 a.m. ET could provide further insight into the health of the U.S. economy and the outlook for rates.
A raft of employment data, including the crucial nonfarm payrolls report, is also due in the coming days.
Traders see a 65.5% chance of the first rate cut this year arriving in June, as per CME Group's FedWatch tool.
The Fed is under no urgent pressure to cut interest rates given a "prospering" economy and job market, Atlanta Fed President Raphael Bostic said in remarks on Monday, adding to worries about rates being higher-for-longer.
Investors will be closely looking at speeches by other Fed policymakers including Vice Chair for Supervision Michael Barr, who is due to speak later in the day.
Among major movers, Target (TGT.N), opens new tab jumped 7.7% in premarket trading after the big-ticket retailer forecast annual comparable sales largely above estimates, betting on same-day services, product launches and a new membership program to boost spending.
Apple (AAPL.O), opens new tab slid 1.9% after a research report showed iPhone sales in China fell 24% year-on-year in the first six weeks of 2024 as the U.S. company faced increased competition from domestic rivals such as Huawei (HWT.UL).
Other megacap growth and technology stocks also declined, with AI darling Nvidia (NVDA.O), opens new tab down 0.7%, while Tesla (TSLA.O), opens new tab slipped 1.9% after its European Gigafactory near Berlin halted production after a suspected arson attack.
At 6:55 a.m. ET, Dow e-minis were down 47 points, or 0.12%, S&P 500 e-minis were down 14.75 points, or 0.29%, and Nasdaq 100 e-minis were down 113 points, or 0.62%.
Advanced Micro Devices (AMD.O), opens new tab fell 2% after a report that the chipmaker hit a U.S. government roadblock in its efforts to sell an artificial intelligence chip tailored for the Chinese market.
Microstrategy (MSTR.O), opens new tab shed 4.9% after the bitcoin development company announced a private offering for $600 million in convertible senior notes, with proceeds to be used to buy bitcoin.
Other major cryptocurrency-linked firms such as Riot Platforms (RIOT.O), opens new tab and Marathon Digital (MARA.O), opens new tab fell 4% and 5.4%, respectively, as bitcoin eased.
Reporting by Bansari Mayur Kamdar and Amruta Khandekar in Bengaluru; Editing by Maju Samuel