US stock index futures edge higher as tech and growth stocks gain

US stock index futures edged higher on Tuesday as some technology and growth stocks rebounded from a selloff in the previous session, while investors awaited key economic data that could determine the Federal Reserve's monetary tightening path, reports Reuters.

Tesla Inc rose 1.6 per cent in premarket trading, bouncing back from 6 per cent declines on Monday after disclosing March-quarter deliveries, while Meta Platforms Inc and Microsoft Corp climbed about 0.6 per cent each.

Oil prices extended gains on Tuesday, with investor attention shifting to demand trends and the impact of higher prices on the global economy.

The renewed inflation worries poured cold water on expectations that the Fed may soon end its aggressive policy tightening amid recent signs of cooling prices, with fresh data on Monday pointing to weakening US manufacturing activity.

Market watchers have been trying to gauge how much longer the Fed may need to keep hiking rates to combat inflation and whether the US economy may be headed for a recession. Concerns over a banking crisis sparked a selloff in the financial sector last month.

However, strong gains in energy stocks helped the benchmark S&P 500 close Monday on a higher note, with the energy sector clocking its strongest one-day gain of nearly 5 per cent in six months on prospects of oil prices inching toward $100 a barrel.

Energy firms Chevron Corp, Exxon Mobil Corp and Occidental Petroleum Corp were set to extend gains, rising between 0.5 per cent and 0.9 per cent premarket.

At 5:54 a.m. ET, Dow e-minis were up 46 points, or 0.14 per cent, S&P 500 e-minis were up 13.75 points, or 0.33 per cent, and Nasdaq 100 e-minis were up 77.5 points, or 0.58 per cent.

The S&P 500 and the tech-heavy Nasdaq have gained 7.4 per cent and 16.5 per cent so far in 2023, recovering from their worst annual drop last year since the 2008 financial crisis, on expectations that the Fed may go easy with its policy tightening.

With renewed inflation concerns, traders' bets of a 25-basis point rate hike in May stood at 59.1 per cent, with odds of a pause at 40.9 per cent, according to CME Group's Fedwatch tool.

Investors will keep a close watch on US job openings, a measure of labor demand, due later on Tuesday, that is likely to show a fall in February and factory orders that likely decreased 0.5 per cent in February.