U.S. stock futures are pointing to a higher open on Thursday, with the Dow Jones, Nasdaq 100, and S&P 500 all in the green, as investors shake off Tuesday's sharp sell-off and digest the Federal Reserve's latest policy decision.
On Wednesday, the Fed unanimously voted to keep the federal funds rate at 3.50%-3.75%, a move that was widely expected. It was the first policy meeting under new Fed Chair Kevin Warsh, who used the occasion to announce the creation of five task forces. These groups will review Fed communications, the balance sheet, data sources, productivity and jobs in the AI era, and the inflation framework itself. It's a lot of homework for the central bank, but markets seemed to take it in stride.
Thursday is the last trading day of the week, as markets will be closed on Friday for Juneteenth National Independence Day. So if you're looking to make moves, today's your chance.
On the bond side, the 10-year Treasury yield is at 4.45%, while the two-year is at 4.17%. According to the CME Group's FedWatch tool, markets are pricing in a 72.2% probability that the Fed will leave rates unchanged at its July meeting. So don't expect any fireworks there.
The SPDR S&P 500 ETF Trust (SPY) and Invesco QQQ Trust ETF (QQQ), which track the S&P 500 and Nasdaq 100, respectively, are both higher in premarket trading. SPY is up 0.71% at $746.20, while QQQ has gained 1.59% to $734.00.
Smith & Wesson Brands
- Smith & Wesson Brands Inc. (SWBI) surged 15.37% after posting better-than-expected fourth-quarter results after Wednesday's closing bell. The gunmaker's earnings beat is a bright spot in an otherwise tough market.
- Market data indicates that SWBI maintains a strong price trend in the long and medium terms but a weak trend in the short term, with a poor growth score.
Safe Bulkers
- Safe Bulkers Inc. (SB) rose 3.40% after reporting better-than-expected first-quarter financial results after the closing bell on Wednesday. The shipping company is riding a wave of positive sentiment.
- Market data indicates that SB maintains a strong price trend in the long and medium terms but a weak trend in the short term, with a solid quality score.
Sleep Number
- Sleep Number Corp. (SNBR) plunged by 55.90% after disclosing that Nasdaq plans to delist its common stock following the mattress maker's recent Chapter 11 bankruptcy filing. It's a brutal day for Sleep Number shareholders.
- Market data indicates that SNBR maintains a weak price trend in the short, long, and medium terms.
Adobe
- Adobe Inc. (ADBE) was up 0.60% as it announced Adobe Brand Visibility, a new solution for businesses to ensure their brand is visible, trusted, and chosen across AI surfaces. Adobe is trying to stay ahead in the AI game.
- Market data indicates that ADBE maintains a weak price trend in the short, medium, and long terms, with a moderate value score.
Freecast
- Freecast Inc. (CAST) zoomed 87.96% after announcing that it has entered into a reseller agreement for Starlink Business services. This agreement enables FreeCast to offer enterprise-grade satellite broadband connectivity alongside its growing portfolio of media, television, advertising, and digital engagement solutions. It's a huge move for the small-cap stock.
- Market data indicates that CAST maintains a strong price trend in the short, long, and medium terms.
Cues From Last Session
It was a rough Wednesday. All S&P 500 sectors ended in the red, led down by communication services, consumer discretionary, and real estate. The major indices took a hit, as you can see below.
Insights From Analysts
Scott Wren, Senior Global Market Strategist at Wells Fargo Investment Institute, is offering an optimistic yet grounded outlook for the U.S. economy and stock market.
On economic growth, Wren says that from a "high altitude, we look for good GDP growth through the end of next year." So the big picture looks solid.
While he expects inflation to ease over the next 18 months, he cautions it will remain "higher on an annual basis than the Federal Reserve (Fed) desires through next year," which will likely keep the Fed from cutting rates anytime soon. So don't hold your breath for rate cuts.
Given this backdrop, Wren remains bullish on corporate performance. "We continue to favor equities over fixed income," he says. He recommends directing new funds toward U.S. Large Cap and Mid Cap Equities, pointing to artificial intelligence secular trends and lower AI-related valuations in sectors like Industrials and Utilities.
Financials remain their "most favored sector," and Wren anticipates that the "S&P 500 Index will post record earnings next year and reach the 8,600-8,800 range." That's a pretty bullish call from Wells Fargo.
Upcoming Economic Data
Here's what investors will be watching on Thursday.
- Initial jobless claims for the week ending June 13, and June's Philadelphia Fed manufacturing survey will both be released at 8:30 a.m. ET.
- On Friday, there are no economic reports scheduled due to the Juneteenth federal holiday.
Commodities, Crypto, And Global Equity Markets
Crude oil futures are trading lower in the early New York session, down 2.20% to around $75.10 per barrel. Oil continues to feel the pressure.
Gold Spot US Dollar rose 0.71% to hover around $4,287.95 per ounce. Its last record high stood at $5,595.46 per ounce. The U.S. Dollar Index spot was 0.04% higher at 99.5760.
Meanwhile, Bitcoin (BTC) was trading 0.99% lower at $64,513.16 per coin over the last 24 hours. Crypto is having a quiet day.
Asian markets closed higher on Thursday, except Hong Kong's Hang Seng and Australia's ASX 200. China's CSI 300, India's Nifty 50, Japan's Nikkei 225, and South Korea's Kospi all rose. European markets were mixed in early trade.
