Wall Street futures hold steady ahead of new economic data
U.S. stock futures were largely unchanged on Thursday as investors paused following a rally driven by rising expectations of a Federal Reserve interest rate cut. Markets also turned cautious ahead of fresh labor and factory data.
The S&P 500 and Dow closed at more than three-week highs on Wednesday, boosted by soft ADP employment data and an ISM survey suggesting easing inflation — both of which strengthened bets that the Fed could cut rates as early as next week, News.Az reports, citing Reuters.
Fresh labor market readings, including weekly jobless claims and the Challenger November layoff report, are due later on Thursday. A delayed factory orders report is also expected.
Small-cap stocks continued to outperform. Russell 2000 futures slipped 0.17%, though the index remains ahead of the S&P 500 on a quarterly basis. Jefferies and BofA Securities both forecast strong earnings growth for smaller firms next year.
“Investors are leaning into the idea that easier policy is coming,” said Matt Britzman, senior equity analyst at Hargreaves Lansdown. “That’s fueling risk appetite across the board.”
Fed funds futures now indicate an 87% chance of a 25-basis-point rate cut this month, up sharply from around 60% in November.
Beyond Thursday’s data, markets are focused on Friday’s September Personal Consumption Expenditures report — the Fed’s preferred inflation gauge — and on U.S. President Donald Trump's search for the next Federal Reserve chair. Concerns have grown among bond investors that leading contender Kevin Hassett may support aggressive rate cuts aligned with Trump’s policy preferences.
At 6:45 a.m. ET, Dow e-minis rose 0.08%, S&P 500 e-minis were flat, and Nasdaq 100 e-minis slipped 0.07%.
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