US equity futures displayed an upward trajectory ahead of Thursday's opening bell, as traders processed the Federal Reserve's recent decision to implement a 50 basis point reduction in its monetary policy. This strategic move aligns with the Fed's commitment to foster a stable economic environment while addressing inflation concerns. The Standard & Poor's 500 Index advanced by 1.5%, while the Dow Jones Industrial Average saw an increase of 1.1%.
The Nasdaq composite rose by a notable 2% during premarket trading. Global markets echoed this sentiment, with significant advancements observed in both Asian exchanges and European stock markets. In a critical meeting held on Wednesday, the Federal Open Market Committee stated that the central bank reduced interest rates to a range of 4.75% to 5%.
This decision came despite a consensus from Bloomberg analysts that anticipated the rates to remain higher within a range of 5% to 5.25%. This move highlights the Fed's proactive stance in maintaining economic growth amid fluctuating inflation rates. Fed Chair Jerome Powell articulated the rationale behind this decision during a press conference on Wednesday.
"This decision reflects our growing confidence that, with an appropriate recalibration of our policy stance, strength in the labor market can be maintained in a context of moderate growth and inflation moving sustainably down to 2%," Powell remarked, emphasizing the importance of adapting monetary policy to current economic conditions. As traders turned their attention to Thursday's economic calendar, several key reports were scheduled for release.
The weekly jobless claims bulletin, the Philadelphia Fed's manufacturing index for September, and the second-quarter current account deficit report were all due at 8:30 am ET. Additionally, the existing home sales report and leading indicators index for August were set to be published at 10 am, followed by the weekly EIA domestic natural-gas supplies report at 10:30 am. In the stock market, shares of Nvidia Incorporated ($NVDA) rose by 3.2% before the opening bell, while Tesla Incorporated ($TSLA) and Meta Platforms Incorporated ($META) followed suit with gains of 2.9% and 2.1%, respectively.
On the other hand, Steelcase Incorporated ($SCS) experienced a decline of 7.9%, which can be attributed to a downturn in international orders during the fiscal second quarter. In the earnings reports sector, Darden Restaurants Incorporated ($DRI), FactSet Research Systems Incorporated ($FDS), and Cracker Barrel Old Country Store Incorporated ($CBRL) were among companies scheduled to unveil their latest financial results before the market opened.
Meanwhile, FedEx Corporation ($FDX) and Lennar Corporation ($LEN) would be sharing their earnings after the market's close. Before the markets opened, Bitcoin was trading up by 3.6%, reaching a value of $62,450. In commodity markets, West Texas Intermediate crude oil prices rose 0.9% to $71.53 per barrel.
U.S. Treasury yields also saw a slight uptrend, with the 10-year yield increasing by 1.7 basis points to 3.7%. Additionally, gold prices were up by 0.7%, trading at $2,615 per ounce. The financial landscape continues to evolve with these key developments, underscoring the importance of monitoring economic indicators and market reactions to the Federal Reserve’s policies..