Traders on the trading floor of the New York Stock Exchange on August 4, 2022.
Source: New York Stock Exchange
Stock futures edged higher in overnight trading Thursday as traders awaited a key policy speech from Federal Reserve Chairman Jerome Powell for any guidance on future rate cuts.
Dow Jones Industrial Average futures rose 47 points. S&P 500 futures and Nasdaq 100 futures edged up 0.2% and 0.3%, respectively.
The Fed chairman is scheduled to speak at the central bank’s annual secret meeting in Jackson Hole, Wyoming, at 10 a.m. ET, and is expected to say the central bank should start cutting interest rates as soon as possible, but there are limited clues about the extent and frequency of cuts.
“Powell is expected to lay the groundwork for the Fed’s first rate cut in more than four years,” said Adam Turnquist, chief technical strategist at LPL Financial. “Signs of easing price pressures and slowing economic growth may be enough for policymakers to start lowering their target interest rates.” ”
Markets are betting on a 25 percentage point cut at the Sept. 17-18 meeting, leaving about a one-in-four chance of a 0.5 percentage point cut, according to CME Group. Fed Watch. Minutes from the July meeting showed an “overwhelming majority” of members supported a rate cut in September.
Stocks were pressured by a surge in U.S. Treasury yields on Thursday ahead of the Jackson Hole speech. The S&P 500 fell 0.9% and the technology-heavy Nasdaq fell 1.7%, suffering its worst day since August 5.
The Dow Jones and S&P 500 remained modestly higher for the week. However, the Nasdaq is down 0.1% so far this week and is expected to post its fifth weekly loss in six.
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