US stock futures today: Why Dow, S&P 500 and Nasdaq futures are rising after Fed hike
US Stock Futures Advance as Technology Shares Lead a Rebound
Bharatmorningnews.com – US stock futures pointed to a stronger opening on Thursday, led by renewed buying in major technology companies and chip-related names. The move followed a difficult session for Wall Street after the Federal Reserve delivered its first interest-rate increase in three years.
Dow Jones Industrial Average futures rose 619 points, or 1.2%, in premarket activity. Futures tied to the S&P 500 added 1.3%, while Nasdaq-100 futures climbed 1.7%, indicating that investors were returning most aggressively to growth-oriented technology stocks.
AI and chip companies drive premarket gains
Nvidia and Amazon, both members of the so-called Magnificent Seven group of large technology companies, were each up roughly 2% before trading began. Microsoft gained about 1%.
The buying extended beyond the largest technology names. Applied Materials, Qualcomm and Intel each advanced close to 3%, reflecting continued investor interest in businesses tied to artificial intelligence infrastructure, semiconductors and computing capacity.
Several other technology-linked shares also posted notable gains. Marvell Technology rose 4.5%, Lam Research added 4%, and Corning jumped 4%. Memory-storage companies Seagate Technology and Western Digital were both higher by about 3.5%.
The broad premarket strength suggested that investors were again willing to take positions in parts of the AI and semiconductor trade after the prior day’s losses. These companies are often especially sensitive to changes in interest-rate expectations because a larger share of their potential value is connected to future earnings growth.
Markets recover after post-Fed sell-off
Wednesday’s regular trading session had been sharply weaker. The Dow fell more than 630 points, or 1.2%, as financial stocks weighed heavily on the blue-chip index. The S&P 500 declined 0.5%, while the technology-heavy Nasdaq Composite finished marginally lower.
The retreat came after the Federal Reserve lifted its overnight federal funds rate by 0.25 percentage point. The new target range stands at 3.75% to 4%.
Fed Chair Kevin Warsh said inflation was still too high, and policymakers signalled that an additional rate increase later in the year remained possible. The decision initially unsettled investors, who were assessing whether tighter monetary policy could restrain economic activity and company profits.
By Thursday morning, however, markets appeared to be focusing more on the possibility that equities could recover after the sell-off. A decline in Treasury yields and lower oil prices also improved the tone for risk assets.
Lower Treasury yields support equity valuations
Government bond yields moved down on Thursday, providing another tailwind for stocks. The yield on the 10-year Treasury note fell by more than five basis points to 4.951%, dropping back below the closely watched 5% level.
The 10-year yield had moved above 5% on Wednesday in the wake of the Fed decision. When Treasury yields rise, they can put pressure on equity valuations, particularly for technology companies whose investors place significant value on expected future growth. A retreat in yields can therefore make those valuations appear more attractive.
Investors were also weighing the broader implications of the Fed’s rate stance. Higher borrowing costs can affect household spending, business investment and credit conditions over time. At the same time, the central bank’s effort to control inflation remains a central concern for markets, making every fresh reading on jobs, housing and consumer demand important.
Mark Haefele, chief investment officer at UBS Global Wealth Management, said his team remained positioned for further equity gains while preparing for near-term volatility.
Haefele said the market advance could widen across sectors and regions if monetary tightening stayed measured, credit spreads remained stable and corporate earnings continued to expand. He also favoured diversified equity exposure, while cautioning investors against excessive concentration in areas highly vulnerable to interest-rate changes or dependent on a single return driver.
Oil prices ease after supply concerns fade
Crude prices declined by about 2%, adding to the more constructive mood in equity markets. US crude slipped below $100 a barrel, while Brent crude fell close to 2% to around $102 a barrel.
Supply-disruption worries eased after Saudi Arabia was said to be making additional crude cargoes available to Asian refiners. The extra volumes were reportedly being transported through ship-to-ship transfers near the port of Sohar in Oman.
Lower oil prices can help calm concerns about energy-driven inflation. For consumers, fuel costs can influence household budgets directly, while businesses often face reduced transport and operating expenses when energy prices decline. The effect on inflation, however, depends on whether the drop is sustained and whether other price pressures remain elevated.
Jobs data remains firm while housing slows
New economic figures released Thursday painted a mixed picture of the US economy. Initial jobless claims dropped by 10,000 to 196,000 for the week ending September 12, below the 207,000 figure expected in the Dow Jones consensus.
Continuing claims fell by 39,000 to 1.73 million. Together, the figures indicated that the labour market remained relatively resilient during the week, despite concerns that higher interest rates could eventually cool hiring.
Housing data was softer. Building permits decreased 2.7% from July to an annualised 1.394 million in August, slightly under the 1.4 million estimate. Housing starts fell 2.6% month on month to 1.275 million, below expectations for 1.3 million.
The contrast between strong labour indicators and weaker housing activity highlights the challenge facing policymakers. A durable labour market can support consumer spending, but slowing construction may signal that elevated financing costs are beginning to affect rate-sensitive areas of the economy.
Generac surges on Amazon data-centre agreement
Generator manufacturer Generac emerged as one of the largest premarket gainers, with its shares soaring 33%. The company announced an agreement with Amazon to provide backup power generators for Amazon data centres.
The sharp move underlined the market’s continued focus on infrastructure supporting cloud computing and AI expansion. Data centres require dependable electricity systems, especially as demand for processing capacity grows. Investors were watching whether the strength in major technology companies could carry into the regular trading session after Wednesday’s rate-driven reversal.
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