Technical data

Dow futures drop more than 200 points as Wall Street prepares for big Federal Reserve meeting this week

Traders work on the floor of the New York Stock Exchange during afternoon trading September 13, 2022 in New York City.

Michael M. Santiago | Getty Images News | Getty Images

Stock futures fell on Monday after major averages posted their worst week since June and ahead of the Federal Reserve’s two-day meeting this week.

Futures contracts linked to the Dow Jones Industrial Average fell 275 points, or 0.9%. S&P 500 and Nasdaq 100 futures fell 0.9% and 1% respectively.

Investors enter the new week focused on the Fed’s latest policy meeting, which begins on Tuesday. The central bank is expected to raise interest rates by another three-quarters of a point, although investors are also watching corporate earnings forecasts ahead of the start of the next reporting season in October.

“As the S&P 500 hovers below the all-important 3,900 level and the 10-year Treasury yield moves ever closer to 3.5%, the Fed-sensitive 2-year Treasury is flirting with 3 .9%, suggesting that the Fed’s aggressive campaign to kill inflation should be taken seriously,” said Quincy Krosby, chief global strategist for LPL Financial. not be dead yet, but he’s probably having trouble breathing.”

Stocks tumbled last week as investors reacted to a hotter-than-expected inflation report and a dismal warning from FedEx about a “significantly worsened” global economy. The major averages posted their fourth weekly loss in five weeks.

Beyond the Fed meeting, there are only a few economic data releases this week, including August Housing Starts on Tuesday and First Jobless Claims on Thursday.

There are also a handful of corporate profits on deck, including Costco, Darden Restaurants, General Mills and Lennar.

—CNBC’s Patti Domm contributed reporting.