Wall Street futures hold steady after tech-fueled rally; Powell in focus

By Niket Nishant and Purvi Agarwal

Sept 23 (Reuters) - U.S. stock index futures were largely unchanged on Tuesday after a tech-driven rally drove Wall Street to record closing highs for the third straight session, while investors awaited Federal Reserve Chair Jerome Powell's remarks on the economy.

Powell's comments could be crucial to shaping interest rate expectations at a time when traders are weighing conflicting signals from the Fed, with some officials arguing for measured cuts going forward to keep inflation in check.

Newly appointed Fed Governor Stephen Miran, however, said on Monday that the central bank risks over-tightening and harming the labor market if it holds back, highlighting the tightrope the Fed faces in balancing inflation against labor market pressures.

"We don't really just have a clean recovery path from the inflation highs of 2022, because we've gotten the shock of tariffs that are basically occurring right when you would have expected to be getting closer to that 2% target," said Michael Reynolds, vice president, investment strategy at Glenmede.

"Right now, it seems like it's the labor market that has the greater risk."

A September reading of S&P Global's flash manufacturing PMI is due after markets open. Comments from Fed Governor Michelle Bowman and Atlanta Fed President Raphael Bostic will also be parsed.

At 6:57 a.m. ET, Dow E-minis YMcv1 were up 33 points, or 0.07%, S&P 500 E-minis EScv1 were down 3 points, or 0.04%, and Nasdaq 100 E-minis NQcv1 were mostly unchanged.

Wall Street has rallied so far in September, a historically weak month for equities, with the S&P 500 index .SPX recording a 3.6% lift as tenacious traders navigate uncertainties around President Donald Trump's policies.

Part of the resilience can be traced to strength in technology stocks and renewed optimism around artificial intelligence-linked trading. Some analysts have, however, raised concerns of stretched stock valuations.

Nvidia NVDA.O slipped 0.7% in premarket trading on Tuesday after hitting an intraday record high in the previous session. The AI chip leader agreed to a tie-up with OpenAI to invest up to $100 billion in and supply it with data center chips.

Investors will also be watching for potential disruptions from H-1B visa regulations, particularly in U.S. technology companies that rely heavily on skilled workers from India and China. So far, mega-cap stocks have largely shrugged off those worries.

Kenvue KVUE.N, the maker of Tylenol that was spun off from Johnson & Johnson JNJ.N in 2023, rose 5.7% premarket, rebounding from a 7.5% plunge that made it the top laggard on the S&P 500 index on Monday.

Trump on Monday linked autism to childhood vaccine use and the taking of popular pain medication Tylenol by women when pregnant.

Boeing BA.N gained 2.8% before the bell after securing an order from Uzbekistan Airways worth over $8 billion, while talks for a Chinese order were ongoing.

Lam Research LRCX.O fell 1.2% after KeyBanc downgraded the chipmaking tools supplier's rating to "sector weight" from "overweight".