Futures subdued after sharp Wall St selloffs

US stock index futures were subdued on Tuesday following a selloff on Wall Street on fears of protracted Federal Reserve action to combat inflation, while focus shifted to Georgia runoff election, which might decide the fate of the US Senate.

All three major indexes closed at their lowest levels in nearly a week on Monday after upbeat services sector data offered more evidence of strength in the U.S. economy despite a series of big interest rate hikes.

Money market bets are pointing to a 91% chance that the U.S. central bank might raise rates by 50 basis points at its Dec. 13-14 policy meeting, with rates expected to peak at 5% in May 2023, up from 4.92% in the previous session, reported Reuters.

"We are very much in looking glass territory again, with investors desperate for the Fed to ease up on rate hikes and therefore taking any bit of good news about the economy as bad news because it will delay the longed-for pivot," AJ Bell investment director Russ Mould wrote in a note.

Concerns about steeper increase in borrowing costs have boosted dollar, while weighing on equities and bond markets this year, with the S&P 500 down 16.1% and the widely followed part of the Treasury yield curve deeply inverted - a harbinger of recession.

As of Dec. 2, analysts expect S&P 500 companies to report a drop of 0.6% in fourth-quarter earnings after posting a 4.4% rise in the third quarter, according to Refinitiv IBES data.