US stock index futures rose on Thursday, building on the positive momentum following Donald Trump’s victory in the 2024 presidential election, with attention now turning to the upcoming Federal Reserve meeting.
As of 06:20 ET (11:20 GMT), Dow Jones Futures were up by 75 points, or 0.2%, S&P 500 Futures gained 9 points, or 0.2%, and Nasdaq 100 Futures increased by 40 points, or 0.2%.
The major indices had strong gains on Wednesday, all closing at record highs. The Dow Jones Industrial Average surged by more than 1,500 points, marking its best performance since 2022.
Investors were buoyed by the expectation of lower corporate taxes under Trump, while the potential for a Republican majority in Congress offered a clear path for significant policy shifts.
Assets linked to Trump’s chances of winning, known as “Trump trades,” rallied on Wednesday. The US dollar surged by its largest margin in two years, while US Treasury yields also climbed.
All eyes are now on the conclusion of the latest Federal Reserve meeting later today.
Markets are largely expecting a 0.25% reduction in the benchmark federal funds rate, which is currently set between 4.75% and 5%. In September, the Fed implemented a larger-than-expected 50 basis point cut to support labor demand amid easing inflation pressures.
Investors will be closely watching for any comments from Fed Chair Jerome Powell regarding the future trajectory of interest rates this year. Futures contracts linked to the Fed’s policy rate are also pricing in the possibility of another rate cut in December, though these expectations have softened somewhat following Trump’s election victory.
Uncertainty over Fed’s Rate Outlook
The Federal Reserve’s stance on interest rates remains uncertain, particularly as recent data reveals persistent inflationary pressures.
Earnings Reports on Tap
Thursday will bring more quarterly earnings reports, with Moderna (NASDAQ: MRNA) and Warner Bros. Discovery (NASDAQ: WBD) set to release results before the market opens. After the close, earnings from Block (NYSE: SQ), Pinterest (NYSE: PINS), and Rivian Automotive (NASDAQ: RIVN) will be in focus.
Positive earnings from chipmakers also helped lift sentiment, with Qualcomm (NASDAQ: QCOM) shares rising over 8% in premarket trading after exceeding quarterly expectations.
Oil Prices Continue to Slide
Oil prices continued to weaken Thursday, extending losses from the previous session as traders assessed the potential implications of a Donald Trump presidency, particularly in light of hopes for additional stimulus from top importer China.
By 06:20 ET, Brent crude was down 0.9% at $74.27 per barrel, while U.S. crude (WTI) fell 1.1% to $70.88 per barrel.
The previous day’s decline was partly driven by a stronger US dollar and a larger-than-expected increase in US crude inventories. However, traders are now considering the potential impact of a Trump presidency on oil supply from Iran and Venezuela, with his pro-business policies expected to support economic growth and boost fuel demand.
In addition, China’s National People’s Congress is expected to announce plans for increased fiscal spending to stimulate economic growth.
Meanwhile, Hurricane Rafael is intensifying as it moves through the Gulf of Mexico, disrupting a significant portion of the region’s crude oil production.
