US Stock Futures Rise on Fed’s Rate Decision and Positive Earnings Outlook

US stock index futures surged on Thursday following the Federal Reserve’s decision to keep interest rates steady, easing concerns over potential hikes, as reported by Reuters.

The Federal Open Market Committee (FOMC) opted to maintain rates unchanged on Wednesday, offering reassurance to investors wary of tightening monetary policies.

Fed Chair Jerome Powell acknowledged persistent inflation but downplayed the likelihood of future rate hikes, citing confidence in current policies to address inflationary pressures.

Market indicators, such as the CME FedWatch tool, currently project a 55.6 per cent chance of a rate cut by September, with higher odds, 69 per cent, anticipated for November.

Preston Caldwell, chief US economist at Morningstar, noted the Fed’s acknowledgment of stagnant inflation, indicating Chair Powell’s optimism that existing measures will steer inflation back to the Fed’s target, diminishing the likelihood of rate hikes.

Despite an initial uptick in response to the Fed’s announcement on Wednesday, major indexes like the S&P 500 and the Nasdaq closed lower.

Investor focus now shifts to Friday’s release of nonfarm payrolls data, crucial for assessing labor market health and its potential impact on future rate decisions.

Additionally, attention is on upcoming weekly jobless claims data and March factory orders for further market insights.

Positive momentum in earnings reports persists, with 77.4 per cent of S&P 500 companies surpassing forecasts, exceeding the historical average, according to LSEG data.

In pre-market trading, Dow E-minis were up 0.46 per cent, S&P 500 E-minis rose 0.71 per cent, and Nasdaq 100 E-minis climbed 0.93 per cent.

Among early movers, Qualcomm soared 5.2 per cent on optimistic sales and profit forecasts, while Carvana surged 37.1 per cent after exceeding sales and profit expectations for the current quarter.



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