March 18 (Reuters) - Wall Street was on track to open higher on Monday, led by a recovery in the tech-laden Nasdaq, ahead of the U.S. Federal Reserve's meeting this week, where the central bank is expected to keep borrowing costs steady and provide cues on its monetary policy trajectory.
Stronger-than-expected inflation, opens new tab figures last week have prompted investors to rethink when and by how much policymakers will lower rates this year, with traders pulling back bets of a June rate cut to around 59% from 71% last Monday, according to the CME FedWatch Tool.
Nevertheless, Wall Street, led by optimism around artificial intelligence (AI), hit fresh all-time highs in March, before pulling back some gains last week.
A hawkish tilt by the Fed in its policy meeting that concludes on Wednesday could further pressure the high-flying indexes. "(Investors) will be looking for more clarity if the broad market consensus opinion of a June rate reduction is still real, they are going to be interpreting the dot plot moving forward, seeing if there's any broad modifications," said Jamie Battmer, chief investment officer at Creative Planning in Kansas.
Goldman Sachs on Monday said they now expect three interest rate cuts in 2024 after inflation came in a bit firmer than expected.
Exchange operator Nasdaq <NDAQ.O> said it has resolved an issue related to connectivity and stock orders after more than two hours.
AI-darling Nvidia(NVDA.O), opens new tab kicked off its annual developer conference, with investors focused on new chip announcements from Chief Executive Jensen Huang in an afternoon keynote address. The chipmaker rose 2.8% in premarket trading.
Peers Micron Technology (MU.O), opens new tab and Advanced Micro Devices (AMD.O), opens new tab added 4.0% and 1.7%, respectively.
At 08:30 a.m. ET, Dow e-minis were up 73 points, or 0.19%, S&P 500 e-minis were up 39.75 points, or 0.77%, and Nasdaq 100 e-minis were up 219.5 points, or 1.22%.
Most megacap growth and technology shares advanced in trading before the bell.
Alphabet (GOOGL.O), opens new tab gained 4.9% after a media report that Apple (AAPL.O), opens new tab is in talks to build Google's Gemini AI engine into the iPhone.
Tesla (TSLA.O), opens new tab rose 4.2% after the electric carmaker said it would increase the price of its Model Y EVs in some European countries on March 22, by approximately 2,000 euros ($2,177) or its equivalent in local currencies.
U.S.-listed shares of Xpeng climbed 6.7% on the company's plans to launch a cheaper EV brand amid fierce price competition.
Boeing (BA.N), opens new tab shed 1% after a media report that a federal grand jury in Seattle issued a subpoena to the planemaker over the Jan. 5 midair blowout of a Boeing door plug on an Alaska Airlines flight.
Super Micro Computer(SMCI.O), opens new tab, which joins the S&P 500 on Monday, climbed 3.2%.
Get a look at the day ahead in U.S. and global markets with the Morning Bid U.S. newsletter. Sign up here.
Reporting by Bansari Mayur Kamdar and Shashwat Chauhan in Bengaluru; Editing by Pooja Desai and Maju Samuel
