U.S. stock futures signaled a positive open on Wednesday, with Wall Street poised to build on its recent strength as investors bet on another interest rate cut from the Federal Reserve and continued momentum from the tech sector.
Nvidia (NASDAQ:NVDA) once again looks to be at the center of the action. The AI chipmaker’s shares climbed 3.6% in pre-market trading, extending Tuesday’s 5% surge that followed news of several major partnerships — including a $1 billion investment in Nokia (NYSE:NOK) as part of a strategic collaboration on networking and AI infrastructure. The rally has brought Nvidia closer to an unprecedented $5 trillion market capitalization, a milestone no company has yet achieved.
Optimism is also being fueled by expectations for the Fed’s policy announcement later today. The central bank is widely expected to trim rates by another quarter percentage point, and traders will parse both the accompanying statement and comments from Chair Jerome Powell for hints about the outlook for further easing through year-end.
Data from CME Group’s FedWatch Tool shows that markets assign an 87% probability to an additional 25-basis-point rate cut in December, though sentiment about more cuts early next year remains mixed.
On Tuesday, U.S. equities maintained their upward bias despite some intraday swings. The Nasdaq Composite rose 0.8% to 23,827.49, the Dow Jones Industrial Average added 0.3% to 47,706.37, and the S&P 500 edged up 0.2% to 6,890.89 — each closing at or near record highs for a second straight day.
The market’s ongoing strength has been underpinned by renewed optimism surrounding U.S.–China trade discussions, bolstered by reports of a new rare-metals agreement between the U.S. and Japan ahead of President Donald Trump’s scheduled meeting with Chinese President Xi Jinping later this week.
Still, many investors appear hesitant to take large new positions before the Fed delivers its policy guidance, preferring to wait for more clarity on the direction of interest rates.
Attention is also turning to a busy stretch of earnings from the U.S. technology giants, with Alphabet (NASDAQ:GOOGL), Apple (NASDAQ:AAPL), Meta Platforms (NASDAQ:META), Microsoft (NASDAQ:MSFT), and Amazon (NASDAQ:AMZN) all set to release quarterly results in the days ahead.
In economic updates, the Conference Board reported a modest decline in U.S. consumer confidence in October, with its index falling to 94.6 from a revised 95.6 in September, slightly better than economists’ expectations.
Sector-wise, networking and steel stocks led gains on Tuesday, with the NYSE Arca Networking Index and NYSE Arca Steel Index both advancing 1.6% to new highs. By contrast, airline shares dropped sharply, sending the NYSE Arca Airline Index down 4.1%, while utilities, commercial real estate, and energy stocks lagged behind.
With momentum still strong and AI-related enthusiasm running high, investors appear ready to extend Wall Street’s winning streak — even as the Federal Reserve’s message later today could test the market’s resilience.
Leave a Reply