Stock futures are little changed after major averages post winning session Live updates

U.S. stock futures hovered near the flatline Tuesday night following a winning session for the major averages.

Dow Jones Industrial Average futures lost 26 points, or 0.06%. S&P 500 futures and Nasdaq 100 futures both slipped about 0.1%.

Wall Street is coming off a strong session for the major averages as tech stocks outperformed, and oil prices eased off their highs. The 30-stock Dow gained 126 points, or 0.3%. The S&P 500 rose nearly 1%, while the Nasdaq Composite rallied about 1.5%.

Those moves seem to reflect growing optimism the Federal Reserve can navigate a soft landing, especially after last week's jobs report showed continued strength in the labor market. Artificial intelligence beneficiaries Nvidia and Broadcom rallied 4% and 3%, respectively.

"I think technology is going to reassert its leadership," Keith Lerner, Truist Wealth co-chief investment officer, said Tuesday on CNBC's "Closing Bell." "The earning trends in tech is still the strongest in the market that we have. And I think we'll see more of a rotation back into that area."

"So, net-net, of course, we're going to see some hiccups up along the way," Lerner said. "But, in our view, the underlying trend is still one that moves up over time."

Regardless, there could be further choppiness in what's historically the most volatile month of the year, particularly just a few short weeks out from the U.S. presidential election. Oil prices dropped Tuesday, after rising earlier this month amid an escalation of conflict in the Middle East. Meanwhile, the 10-year U.S. Treasury yield has climbed back above 4%.

On the economic front, investors are anticipating the latest meeting minutes from the Fed on Wednesday, due at 2 p.m. ET. The September consumer and producer price index readings are due out Thursday and Friday, respectively.

Earnings season kicks off Friday with the big banks JPMorgan Chase and Wells Fargo.

Fed lowered rates to maintain labor market’s strength, says Vice Chair Philip Jefferson

Federal Reserve policymakers sought to keep the labor market strong when they decided to trim the fed funds target range by a half point in September, according to prepared comments from Fed Vice Chair Philip Jefferson.

He spoke at an event at Davidson College in North Carolina on Tuesday night.

"The [Federal Open Market Committee] has gained greater confidence that inflation is moving sustainably toward our 2 percent goal," he said. "To maintain the strength of the labor market, my FOMC colleagues and I recalibrated our policy stance last month, lowering our policy interest rate by 1/2 percentage point."

The target range for the fed funds rate now sits at 4.75% to 5.00%.

Jefferson added that he will "carefully watch incoming data, the evolving outlook, and the balance of risks when considering additional adjustments to the federal funds target range."

—Darla Mercado

Wholesale inventories data due out Wednesday

Wholesale inventories — which refers to the unsold inventory held by wholesalers — is expected to have risen 0.2% in August, according to economists polled by Dow Jones. That's in line with the 0.2% increase in the previous reading.

The data is due out 10 a.m. ET.

— Sarah Min

Stock market risk grows as yield curve steepens, Bank of America says

The risk that stocks will weaken increases as the Treasury yield curve between 2- and 10-year notes steepens, according to Bank of America technical analyst Stephen Suttmeier in a note to clients Tuesday.

The S&P 500, for example, "is vulnerable to bigger corrections when the yield curve is steepening," Suttmeier wrote. "The biggest correction the SPX has had since the yield curve bottomed in June 2023 is the late July 2023 into late October 2023 drop of 10.3%. This compares to the average and median biggest corrections of 26.5% and 20.3%, respectively, during yield curve steepening cycles."

Ten out of the last 12 steepening cycles coincided with U.S. recessions, the analyst noted.

The 10-year Treasury note yielded 4.01% in late trading Tuesday, versus 3.96% for the 2-year. On May 31, the 10-year yielded 4.51% while the 2-year yielded 4.89%.

— Scott Schnipper

U.S. stock futures open lower

U.S. stock futures opened lower Tuesday night.

Dow Jones Industrial Average futures fell by 13 points, or 0.03%. S&P 500 futures and Nasdaq 100 futures dipped 0.05% and 0.06%, respectively.

— Sarah Min