U.S. stock futures were rising early Wednesday after Federal Reserve Chair Jerome Powell raised hopes for interest-rate cuts later this year.
Futures for the Dow Jones Industrial Average lost 17 points, or less than 0.1%. But S&P 500 futures gained 0.1%, while contracts tracking the technology-heavy Nasdaq rose 0.2%. The Dow fell Tuesday but the other two finished higher, touching new records.
Powell said Wednesday that the weakening labor market is becoming a bigger concern and could be pushing down on inflation. The comments reinforced expectations that the Fed could start lowering rates as soon as September, which would be a boost for stocks. Inflation data out Thursday will add to the picture.
“Policymakers are keeping a close eye on whether restrictive rates are squeezing enough demand out of the economy,” said Susannah Streeter, head of money and markets at Hargreaves Lansdown. “U.S. indices are still hanging close to record highs, with enthusiasm over artificial intelligence possibilities and hopes for a soft landing for the economy still buoying sentiment.”
Bond yields were down a little from Tuesday. The yield on the benchmark 10-year U.S. Treasury bond was at 4.287%. The yield on the 2-year note was at 4.635%.