US STOCKS-Wall St set for muted open as AI jitters linger; key economic data awaited

By Twesha Dikshit and Nikhil Sharma

Feb 9 (Reuters) - Wall Street indexes were on track for a subdued open on Monday, after a week in which AI disruption worries caused technology stocks to tumble, as investors awaited crucial economic data for insight into the U.S. Federal Reserve's interest-rate path.

The S&P 500 and the Nasdaq had rebounded on Friday after three consecutive sessions of losses as the AI trade came under renewed scrutiny following Big Tech companies unveiling heavy capital expenditure projections.

A handful of recent megacap results revived investor worries about ambitious spending this year, with marquee "Magnificent Seven" companies Amazon AMZN.O, Google GOOGL.O, Meta META.O and Microsoft MSFT.O collectively expected to spend around $650 billion in the race for AI dominance.

Software names, pressured the previous week by concerns that AI could intensify competition and squeeze margins, were largely stable in Monday's premarket trading.

"After a hectic week last week, basically the size of the rebound that we saw (on Friday) didn't feel like the beginning of a sustainable reversal in losses. So I'm not surprised to see this morning that now futures are down," said Ipek Ozkardeskaya, senior market analyst at Swissquote Bank.

At 08:07 a.m. ET, Dow E-minis YMcv1 were down 15 points, or 0.03%, U.S. S&P 500 E-minis EScv1 lost 1.75 points, or 0.03%, and Nasdaq 100 E-minis NQcv1 fell 27.75 points, or 0.11%.

The Dow had a spectacular run on Friday, when it closed above 50,000 points for the first time and posted weekly gains, helped by a rotation into other pockets of the market. The small-cap Russell 2000 .RUT also gained.

The next big test for AI shares will be chip giant Nvidia's NVDA.O earnings later this month with investors increasingly demanding measurable gains from capex spending. Nvidia was down marginally before the bell.

Other chip stocks also fell; Micron Technology MU.O was down 3%, Broadcom AVGO.O shed 1%, while AMD AMD.O lost 0.7%.

Focus will turn to economic data this week, including the key January nonfarm payrolls report on Wednesday - delayed by a partial government shutdown - and the closely watched January consumer price index on Friday, both essential for clues on the central bank's rate-cut decisions.

Markets are currently pricing in the year's first rate cut in June, according to CME Group's FedWatch tool, which could be when Kevin Warsh, U.S. President Donald Trump's nominee for Fed chair, takes over.

Eli Lilly's LLY.N shares rose 2% after telehealth firm Hims & Hers HIMS.N canceled the launch of a $49 weight-loss pill over the weekend following legal threats from the U.S. Food and Drug Administration. Wegovy maker Novo Nordisk NOVOb.CO sued Hims on Monday for patent infringement, sending the latter's shares dropping 20%.

Of the 293 companies in the S&P 500 that have already reported earnings for the quarter, around 77% have beaten analysts' expectations, according to LSEG data. The long-term average for a beat is 67%.

Apollo Global Management APO.N rose 1.5% after the asset manager reported a 13% rise in fourth-quarter profit.

Kyndryl KD.N shares dropped almost 38% after the IT services provider delayed quarterly filing after flagging material weakness in its financial reporting.

Markets will also watch for Fed members later in the day, with Christopher Waller, Stephen Miran and Atlanta President Raphael Bostic on deck to speak.

In other movers, Kroger's KR.N shares added 5.6% after the Wall Street Journal reported the grocery giant plans to name former Walmart executive Greg Foran its chief executive officer.