Stock futures stumble as record rally slows

US stock futures fell on Friday, signaling a pullback from all-time highs as European turmoil rattled nerves and Elon Musk’s pay package win put Tesla (TSLA) in pole position.

Dow Jones Industrial Average futures (YM=F) fell about 0.7% to lead the declines, while S&P 500 futures (ES=F) fell 0.5%. Futures on the tech-heavy Nasdaq 100 (NQ=F) fell nearly 0.2%.

Stocks are losing ground after the S&P 500 (^GSPC) and Nasdaq Composite (^IXIC) posted a record close for the fourth straight day, buoyed by strength in technology. Investors were encouraged by the sudden lull in wholesale price pressures Bet on two interest rate cuts This year, since the decline is likely to be reflected in the upcoming inflation reading for personal consumption expenditures monitored by the Federal Reserve.

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But the Federal Reserve this week cut its expected interest rate cuts from three to one in 2024, keeping the market guessing and leaving stocks vulnerable to changes in mood. Strength in the technology sector has led to broader gains, leaving the S&P 500 and Nasdaq primed for weekly gains — at least for now. But the Dow Jones faces a loss this week, as questions remain about how wide the rally will be this year.

Meanwhile, Tesla shares rose about 1% premarket on Friday after shareholders reapproved CEO Elon Musk’s $56 billion pay package. The electric car manufacturer said that despite opposition from some major investors, 77% of votes were cast in favor of the project.

The decline in European stocks (^STOXX), which were heading for their worst week since October, did not help. Investors are concerned about the repercussions on markets if the far right makes gains or even wins in the early French elections.

Another dose of anxiety came from the Bank of Japan’s decision to hold off on providing details on bond purchase cuts until July, a surprise move that was interpreted as a delay to the interest rate hike.

In individual moves, Adobe (ADBE) shares jumped 15% following upbeat AI sales forecasts from the Photoshop maker.