US Futures Flat as Fed Comments Temper Rate Cut Hopes
By Ambar Warrick
In the evening trading session on Thursday, U.S. stock index futures showed minimal movement, mirroring a subdued close on Wall Street. This stagnation followed comments from several Federal Reserve officials who cautioned against premature expectations for interest rate cuts.
Earlier in the week, weaker-than-expected consumer inflation data had propelled Wall Street to record highs. However, these gains were short-lived due to the Fed's warnings, leading traders to slightly lower their expectations for a rate cut in September.
As of 19:36 ET (23:36 GMT), S&P 500 Futures were steady at 5,320.50 points, Nasdaq 100 Futures remained flat at 18,653.0 points, and Dow Jones Futures also held steady at 40,017.0 points. Additionally, a rise in Treasury yields added pressure on stocks.
Fed Officials Advocate for Caution
Fed officials, including Atlanta Fed President Raphael Bostic, New York Fed President John Williams, and Cleveland Fed President Loretta Mester, emphasized the need for more evidence before considering interest rate cuts. Despite welcoming the recent positive inflation data, Bostic and Williams highlighted that a single data point does not confirm a trend. Mester reiterated the necessity of maintaining higher rates longer to effectively manage inflation.
These statements led investors to reassess their rate cut expectations, with the CME Fedwatch tool indicating a slight reduction in the anticipated 25 basis point cut for September.
Wall Street Retreats from Record Highs
Persistent doubts regarding interest rate cuts caused Wall Street to lose momentum on Thursday, retreating from its record highs. The S&P 500 decreased by 0.2% to 5,297.10 points, the NASDAQ Composite fell 0.3% to 16,698.32 points, and the Dow Jones Industrial Average dropped 0.1% to 39,869.38 points.
Aftermarket Movers: Reddit and Others
In after-hours trading, Reddit Inc (NYSE:RDDT) surged over 11% following its announcement of a partnership with OpenAI to integrate its content into AI products. Conversely, Take-Two Interactive Software Inc (NASDAQ:TTWO) declined by 2.6% after issuing disappointing annual earnings guidance and revealing that the highly anticipated GTA VI title would not release until 2025. DXC Technology Co (NYSE
XC) also saw a significant drop of 20% due to lackluster annual guidance.
Meanwhile, meme stocks GameStop Corp (NYSE:GME) and AMC Entertainment Holdings Inc (NYSE:AMC) experienced some relief, rising 3.4% and 5.9% respectively, after suffering substantial losses earlier in the day.
By Ambar Warrick
In the evening trading session on Thursday, U.S. stock index futures showed minimal movement, mirroring a subdued close on Wall Street. This stagnation followed comments from several Federal Reserve officials who cautioned against premature expectations for interest rate cuts.
Earlier in the week, weaker-than-expected consumer inflation data had propelled Wall Street to record highs. However, these gains were short-lived due to the Fed's warnings, leading traders to slightly lower their expectations for a rate cut in September.
As of 19:36 ET (23:36 GMT), S&P 500 Futures were steady at 5,320.50 points, Nasdaq 100 Futures remained flat at 18,653.0 points, and Dow Jones Futures also held steady at 40,017.0 points. Additionally, a rise in Treasury yields added pressure on stocks.
Fed Officials Advocate for Caution
Fed officials, including Atlanta Fed President Raphael Bostic, New York Fed President John Williams, and Cleveland Fed President Loretta Mester, emphasized the need for more evidence before considering interest rate cuts. Despite welcoming the recent positive inflation data, Bostic and Williams highlighted that a single data point does not confirm a trend. Mester reiterated the necessity of maintaining higher rates longer to effectively manage inflation.
These statements led investors to reassess their rate cut expectations, with the CME Fedwatch tool indicating a slight reduction in the anticipated 25 basis point cut for September.
Wall Street Retreats from Record Highs
Persistent doubts regarding interest rate cuts caused Wall Street to lose momentum on Thursday, retreating from its record highs. The S&P 500 decreased by 0.2% to 5,297.10 points, the NASDAQ Composite fell 0.3% to 16,698.32 points, and the Dow Jones Industrial Average dropped 0.1% to 39,869.38 points.
Aftermarket Movers: Reddit and Others
In after-hours trading, Reddit Inc (NYSE:RDDT) surged over 11% following its announcement of a partnership with OpenAI to integrate its content into AI products. Conversely, Take-Two Interactive Software Inc (NASDAQ:TTWO) declined by 2.6% after issuing disappointing annual earnings guidance and revealing that the highly anticipated GTA VI title would not release until 2025. DXC Technology Co (NYSE
XC) also saw a significant drop of 20% due to lackluster annual guidance.Meanwhile, meme stocks GameStop Corp (NYSE:GME) and AMC Entertainment Holdings Inc (NYSE:AMC) experienced some relief, rising 3.4% and 5.9% respectively, after suffering substantial losses earlier in the day.
