US stock futures rose as investors bet that an interest rate cut from the Federal Reserve could land sooner rather than later.
Futures attached to the Dow Jones Industrial Average (YM=F) jumped 0.2%. Futures attached to the benchmark S&P 500 (ES=F) and the tech-heavy Nasdaq 100 (NQ=F) ticked up 0.1%.
On Thursday, stocks climbed and the S&P 500 and Nasdaq flirted with, but ultimately missed, hitting new records. The rally came as investors digested new reasons to believe the Fed may cut interest rates as early as July and braced for the arrival of additional insight on Friday.
Fresh ecodata showing a softening in the labor market gave investors a new wave of confidence that the Fed could reduce rates imminently. But bets on a rate cut had already been mounting since President Trump on Wednesday talked up his search for a successor to Federal Reserve Chair Jerome Powell, and new reports indicated he wants to reveal his pick early.
Friday’s release of the Fed’s preferred inflation gauge, the Personal Consumption Expenditures (PCE) report, is consequently being met with much anticipation. Investors will be watching closely for any signs that Trump’s tariffs pushed prices higher, an issue Powell has stressed could be a stumbling block to a rate cut.
Meanwhile, Trump’s trade policy continues to be in flux. A top economic advisor to Trump echoed recent assurances from the administration that countries negotiating trade deals with the US would get an extension on the tariff pause, which is set to expire in less than two weeks.
Coming soon
Stock market coverage for Friday, June 27, 2025.