Dow Jones Today: Stock Futures Point to Higher Open as Rally Continues
Stocks opened higher on Friday as major indexes are set to post gains for the week, recovering most of the losses that were recorded during an early month-selloff.
The S&P 500 and Nasdaq Composite were up 0.4% and 0.3%, while the Dow Jones Industrial Average added 0.6%. The S&P 500 and Nasdaq are riding four-day winning streaks, boosted by solid gains for technology stocks and expectations that the Federal Reserve will start cutting interest rates next week.
Large-cap technology stocks were mixed in early trading Friday. Alphabet (GOOGL), Amazon (AMZN), and Broadcom (AVGO) gained ground, while AI investor favorite Nvidia (NVDA), Microsoft (MSFT), Apple (AAPL) and Meta Platforms (META) were down.
Among noteworthy movers Friday, shares of Boeing (BA) were down more than 2% after the aircraft manufacturer’s machinists overwhelmingly voted against a new contract and went on strike. Shares of Adobe (ADBE) fell 9% after the software maker issued a disappointing sales outlook, while Oracle (ORCL) gained 3% after the company boosted its sales guidance.
The economic data calendar is light on Friday, after a busy few days of indicators that investors watched closely as they looked for details that could affect the Fed’s decision on interest rates. The Fed is widely expected to cut its benchmark rate next Wednesday for the first time in four years, as inflation continues to moderate and the labor market weakens.
While Fed officials have made clear that rate cuts are coming, it’s not clear how big those cuts will be. Market participants are now pricing in about a 47% chance that the Fed will cut the benchmark rate by half a percentage point next week, according to the CME Group’s FedWatch tool, which forecasts rate movements based on fed funds futures trading data. That’s up from about 30% yesterday and 15% on Wednesday.
While investors have been clamoring for rate cuts, the Fed normally doesn’t adjust rates by more than a quarter point at a time. A larger cut than that, some analysts say, could send the signal that the Fed sees the possibility of a significant deterioration of the economy.
The yield on 10-year Treasurys, which is closely correlated to expectations around interest rates, fell to 3.65% on Friday, from 3.68% late yesterday.
Gold futures were up 1% to a fresh record high above $2,600 an ounce, while crude oil futures were up more than 1%, extending a multi-day recovery after hitting their lowest point in more than a year earlier in the week. Bitcoin was little changed at around $58,000.