U.S. equity futures pointed higher early Wednesday, signaling that stocks may extend the upside momentum seen in the previous session.
Futures held their gains after new data from ADP showed an unexpected decline in private-sector hiring for November. The payrolls firm reported a drop of 32,000 jobs, reversing a revised 47,000 increase in October. Economists had been looking for a modest gain of around 10,000 jobs.
The surprise contraction has reinforced expectations that the Federal Reserve will deliver another rate cut when policymakers meet next week. According to CME’s FedWatch tool, traders now assign an 88.8% probability to a reduction of 25 basis points.
Risk appetite is also getting a lift from another strong move in Bitcoin, which is up more than 2% in early trading following a sharp rally on Tuesday.
On Tuesday, U.S. markets spent much of the day swinging between gains and losses but ultimately closed higher, recovering some of Monday’s weakness. The Nasdaq added 0.6% to finish at 23,413.67. The Dow climbed 0.4% to 47,474.46, and the S&P 500 advanced 0.3% to 6,829.37.
The rebound in crypto played a notable role in Tuesday’s upbeat tone. Bitcoin (COIN:BTCUSD) surged more than 6% after plunging the day before. Momentum in Nvidia (NASDAQ:NVDA), one of the market’s bellwether AI stocks, also helped support broader sentiment.
Chipmakers led the advance, with the Philadelphia Semiconductor Index jumping 1.8%. Hardware names were also strong, as the NYSE Arca Computer Hardware Index rose 1.7%.
Airline and telecom shares saw healthy gains, while companies tied to gold, natural gas, and oil retreated.
Still, overall conviction among traders remained cautious, with markets eyeing several upcoming U.S. economic releases that could influence expectations heading into next week’s Fed announcement.
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