U.S. stock index futures edged higher on Wednesday, rebounding from Tuesday’s decline on Wall Street, as investors looked ahead to the Federal Reserve’s anticipated interest rate cut.
Markets have fully factored in a 25 basis point rate cut following the conclusion of the Fed meeting on Wednesday. However, attention will center on signals about the longer-term rate trajectory, with the Fed expected to take a more gradual approach to easing rates after a December cut.
By 06:25 ET S&P 500 Futures rose 0.27% to 6,143.75 points, while Nasdaq 100 Futures gained 0.23% to 22,365.25 points.
Dow Jones Futures climbed to 44,083.00 points, recovering slightly after the index posted its longest losing streak since 1978 on Tuesday.
Market attention will be firmly centered on the Federal Reserve’s economic projections for the upcoming year and remarks from Chair Jerome Powell.
These updates are expected to provide insight into the Fed’s long-term rate strategy, particularly as inflation remains persistent and is projected to rise further under the incoming administration of President Donald Trump.
Investors anticipate the Fed will signal a slower pace of rate cuts in 2025, given ongoing concerns about elevated inflation and a robust labor market—two significant challenges for policymakers.
Earlier in the day, data revealed that retail sales increased by 0.7% in November, exceeding the expected 0.5% gain.
The stronger-than-anticipated retail sales indicate that the economy remains resilient, with consumer spending holding steady despite headwinds such as inflation and elevated interest rates.
This economic strength is underpinned by a strong labor market and stable household finances.
