Futures fall ahead of Fed meeting, corporate earnings

© Reuters. FILE PHOTO: A street sign for Wall Street is seen outside of the New York Stock Exchange (NYSE) in New York City, New York, U.S., June 28, 2021. REUTERS/Andrew Kelly

(Reuters) - U.S. stock index futures fell on Tuesday following a turbulent start to the week, with investors keeping an eye out for the Federal Reserve meeting and a host of major earnings from companies including Microsoft (NASDAQ:MSFT).

The Fed is expected to convene its two-day monetary policy meeting later in the day, which will be watched closely for cues on the central bank's timeline for hiking key interest rates to combat inflation.

Fed funds futures traders are pricing in a 25 basis points hike in March, in addition to three more rate increases by the end of the year.

The quarterly earnings season is in full swing, with megacap growth companies Microsoft, Apple (NASDAQ:AAPL) and Tesla (NASDAQ:TSLA) reporting this week, following a series of mixed results from big banks and disappointing numbers from pandemic darlings such as Netflix (NASDAQ:NFLX).

Earnings from S&P 500 companies are expected to grow 23.7% year-over-year, according to IBES estimates from Refinitiv.

IBM (NYSE:IBM) jumped 1.9% in premarket trading after the IT giant beat Wall Street estimates for revenue and profit in the fourth quarter, as its focus on the cloud paid off.

Geopolitical tensions between the West and Russia over Ukraine have added to uncertainty. The U.S. Department of Defense said about 8,500 American troops were put on heightened alert.

U.S equities had a turbulent start to the week with the S&P 500 coming close to confirming a 10% correction on Monday.

At 6:53 a.m. ET, Dow e-minis were down 265 points, or 0.77%, S&P 500 e-minis were down 58 points, or 1.32%, and Nasdaq 100 e-minis were down 269.25 points, or 1.86%.

Microsoft fell 0.9% ahead of its quarterly results after markets close, while Wells Fargo (NYSE:WFC), which was down 1.1%, led declines among the shares of major Wall Street lenders.

Nike Inc (NYSE:NKE) rose 1.3% after Wells Fargo upgraded the company's stock to "overweight" from "equalweight".

Investors will be eyeing consumer confidence data later in the day for clues on economic health after the resurgence of COVID-19 cases due to the Omicron variant.