July 24 (Reuters) - U.S. stock index futures inched higher on Monday as earnings from megacap growth and technology companies roll in and investors look ahead to a rate decision from the Federal Reserve later this week.
Meta Platforms, Microsoft and Alphabet are among the big names reporting this week, with investors cautious after less-than-stellar reports by Netflix and Tesla.
The EV maker eased 1.2% in premarket trading after UBS downgraded its rating on the stock, while other megacap growth and technology stocks edged higher.
The centerpiece event of the week is the Fed's policy meeting, with the central bank expected to raise interest rates by 25 basis points on Wednesday.
A majority of economists polled by Reuters still expect this will be the last increase of the current tightening cycle, after data this month showed signs of disinflation, eliminating the need for the Fed to lift rates further and supporting the thesis that has helped buoy stocks in recent weeks.
The tech-heavy Nasdaq has rallied 34% so far this year, outperforming its Wall Street peers, as rate-sensitive megacap growth companies jumped on hopes that the Fed's aggressive rate hike cycle will end soon and optimism over artificial intelligence.
"As this week's Fed meetings falls in the middle of a jungle of earnings, stock investors will have a lot to price on their plate, so a hawkish statement from the Fed may not directly impact stock prices if earnings are good enough," said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
At 06:52 a.m. ET, Dow e-minis were up 51 points, or 0.14%, S&P 500 e-minis were up 9.75 points, or 0.21%, and Nasdaq 100 e-minis were up 40 points, or 0.26%.
The S&P 500 and the Dow ended last week higher with the latter posting its longest winning streak since 2017, helped by strong quarterly reports from healthcare and financial companies.
Among early movers, toymaker Mattel rose 1.5% as the "Barbie" movie set record as the biggest domestic debut of 2023, while shares of Warner Bros, which is spearheading the film, added 0.5%.
AMC Entertainment jumped 47.5% after CEO Adam Aron said on Sunday the company filed a revised petition for a stock conversion plan to address the Delaware court's concerns over other shareholders. AMC's preferred shares rose 1.7%.
Exchange operator Nasdaq trimmed the weight of a handful of companies that make up close to half of the Nasdaq 100 to address "overconcentration" in the benchmark.
Also on tap on Monday, the S&P Global is expected to show its flash services sector PMI fell to 54.1 from 54.4 in June, while the closely watched flash manufacturing PMI likely rose to 46.4 in July from 46.3 in the previous month.
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