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US Stock Futures Dip After Wall Street Rally

US Stock Futures Dip After Wall Street Rally. Source: Carlos Delgado, CC BY-SA 3.0, via Wikimedia Commons

U.S. stock futures edged lower Thursday evening as markets cooled following a strong Wall Street rally driven by falling oil prices and Treasury yields after the Federal Reserve raised interest rates.

S&P 500 futures slipped 0.09% to 7,699.75 points by 19:14 ET, while Nasdaq 100 futures declined 0.17% to 29,694.50. Dow Jones futures also fell 0.09% to 52,173.0.

The modest pullback followed a strong session for U.S. stocks after three consecutive days of losses ahead of the Fed’s Wednesday rate decision. Technology and semiconductor stocks led the rebound as investors moved past recent concerns about slowing artificial intelligence development.

Improving sentiment was partly fueled by lower crude oil prices. Reports indicated Saudi Arabia was increasing oil shipments to Asian buyers through Oman, helping offset supply disruptions linked to Houthi attacks in the Red Sea. Riyadh is also expected to restart its key east-west oil pipeline after it was shut following Houthi strikes last week.

However, geopolitical risks remain elevated as Saudi Arabia continues fighting Yemen’s Iran-backed Houthis and the Strait of Hormuz remains closed, providing underlying support for crude prices.

Treasury yields also declined sharply, with the benchmark 10-year yield falling below 5% despite the Federal Reserve delivering its first interest rate hike in three years.

Fed Chair Kevin Warsh maintained a hawkish stance, warning that inflation remains too high and signaling the possibility of additional rate increases. Still, bond yields dropped as the Fed’s decision and economic outlook reduced some uncertainty surrounding the future path of U.S. monetary policy.

The rate hike also strengthened expectations that policymakers are focused on controlling inflation while maintaining economic stability.

On Thursday, the S&P 500 gained 1.1%, while the tech-heavy Nasdaq Composite climbed 1.7%. The Dow Jones Industrial Average advanced 0.6%. Despite the rebound, all three major U.S. stock indexes remained roughly flat to slightly lower for the week.

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