Updates with analyst comment, prices

By Pranav Kashyap and Twesha Dikshit

Jan 27 (Reuters) - S&P 500 and Nasdaq futures climbed on Tuesday ahead of a slate of mega-cap earnings, while health insurers slid after a Medicare Advantage payment proposal from the Trump administration disappointed investors.

Dow futures lagged, pressured by an almost 15% drop in UnitedHealth UNH.N after the Trump administration floated only a modest increase in Medicare insurer payment rates.

The proposal clouded over the insurer's forecast for 2026 adjusted profit, which was above analysts' expectations. Peers Humana HUM.N and CVS CVS.N fell 15% and 11.7%, respectively.

Shares of United Parcel Service UPS.N rose 3.6%, after the company forecast higher 2026 revenue. General Motors GM.N posted a higher fourth-quarter core profit, sending shares up 4.7%. RTX RTX.N added 2.7% after reporting higher quarterly sales.

Meanwhile, JetBlue Airways JBLU.O shares dipped 5.1% after posting a wider-than-expected quarterly loss. Airline shares have come under pressure due to mass cancellations amid the winter storm in Eastern U.S.

With earnings in full gear, market focus will remain on results of corporate bellwethers, including Boeing BA.N, that are scheduled to report before the bell.

At 07:07 a.m. ET, Dow E-minis YMcv1 were down 0.33%, S&P 500 E-minis EScv1 were up 0.25% and Nasdaq 100 E-minis NQcv1 were up 0.64%

In total, 102 S&P 500 companies are set to post earnings results this week. Of the 64 that had reported as of Friday, 79.7% have topped analyst expectations, as per data compiled by LSEG.

Meta META.O, Microsoft MSFT.O, and Tesla TSLA.O report earnings on Wednesday, kicking off results from the so‑called "Magnificent Seven", which will test the AI trade that has underpinned Wall Street's rally for much of the past year.

Gains in a handful of megacap names raised the S&P 500 and Nasdaq to their highest levels in over a week during the previous session.

"What investors want to see is money flowing into the AI ecosystem from outside — meaning from end users, enterprises and third-party businesses," said Ipek Ozkardeskaya, senior market analyst at Swissquote.

"By the time demand accelerates, some infrastructure risks becoming obsolete — implying that part of today's capex could end up wasted. That is what investors will be watching closely in upcoming earnings: whether they stay invested, or cash out."

Signs of crowding in the AI trade have recently spurred a rotation into small‑caps and other undervalued parts of the market.

The Russel 2000 index, has risen over 7% while the S&P 600 small-cap index .SPCY has advanced 6.5% this month, compared with the benchmark S&P 500's 1.5% gain.

FED WATCH

The Federal Reserve begins its two‑day policy meeting on Tuesday, with investors broadly expecting the central bank to leave interest rates unchanged.

Attention will be on policymakers' guidance, with traders alert to any signals around the Fed's leadership outlook. Questions over the Fed's independence resurfaced earlier this month after the Justice Department opened an inquiry involving Powell.

Consumer confidence figures for January are due at 10 a.m. ET, and expected to rise to 90.9 points from 89.1 in December.

The risk of a partial U.S. government shutdown also loomed ahead of the January 30 funding deadline, as a second fatal shooting by federal agents in Minneapolis sharpened scrutiny of Trump's immigration crackdown.

Among other stock moves, Salesforce CRM.N rose 2.5% after the U.S. army awarded the company a $5.6 billion contract.

(Reporting by Pranav Kashyap and Twesha Dikshit in Bengaluru; Editing by Krishna Chandra Eluri)

((pranav.kashyap@tr.com; +919886482111;))