Futures stall as big banks set to kick earnings into high gear

(Reuters) - Futures tied to the S&P 500 and the Nasdaq 100 indexes paused near record levels on Friday ahead of results from JPMorgan, Citigroup and Wells Fargo that will throw second-quarter earnings season into high gear.

JPMorgan Chase (NYSE:JPM), the largest U.S. lender, is expected to report a decline in quarterly profit, with analysts expecting large lenders to set aside more money to cover deteriorating loans.

Shares of both JPMorgan and Citigroup were marginally down ahead of results.

As the S&P 500 and Nasdaq scale new peaks, investors are hoping for strong profit growth from companies beyond the heavyweight tech names such as Nvidia (NASDAQ:NVDA) so that the U.S. stocks rally can broaden out.

A rotation out of high-flying large cap stocks in favor of small-cap shares knocked back the tech-laden Nasdaq by nearly 2% on Thursday after a surprise fall in U.S. consumer prices solidified bets of a September interest rate cut.

Traders now see an 86% chance of a rate cut in September, up from 72% a week ago, according to CME Group's (NASDAQ:CME) FedWatch Tool.

For further evidence of cooling inflation, investors will look to producer prices data for June and the University of Michigan's consumer survey data later in the day.

At 04:46 a.m., Nasdaq 100 E-minis fell 9.25 points, or 0.05%, and S&P 500 E-minis rose 4.75 points, or 0.08%. The Dow E-minis gained 39 points, or 0.1%.

Tesla (NASDAQ:TSLA) dipped 1.4% as UBS downgraded the electric vehicle maker to "sell".

U.S. regional lender Bank of New York Mellon (NYSE:BK) and industrial supplies maker Fastenal (NASDAQ:FAST) are also scheduled to report.