Stock market surges after Fed cut: Nasdaq leads gains as rate outlook shifts
US stocks are rising sharply on Thursday morning after the Federal Reserve made its first interest rate cut of the year and signaled that more are likely to follow. Nasdaq futures led the charge, up over 1%, as tech stocks rebounded and Wall Street eyed fresh record highs.
Markets rally after Fed cut
The Federal Reserve lowered its benchmark interest rate by 0.25% on Wednesday, bringing it down to a target range of 4.00% to 4.25%. It was the first rate cut in nine months and a move that had been widely anticipated.
Now, the Fed’s “dot plot” points to two additional cuts before the end of 2025, which boosted investor confidence heading into Thursday’s session.
- Nasdaq 100 futures: +1.08%
- S&P 500 futures: +0.89%
- Dow Jones Industrial Average futures: +0.72%
If these premarket gains hold, the S&P 500 is expected to open above 6,700, a new all-time high, after closing above 6,600 earlier this week.
What’s driving the surge?
Several key factors are lifting sentiment:
- Fed policy shift confirmed: Markets now believe the Fed will continue easing into 2026
- Labor market weakness: Rising unemployment gave the Fed room to cut
- Tech rebound: Big names like Meta and Nvidia are climbing again
- Diminished inflation fears: While inflation is still elevated, it’s no longer accelerating
“There’s no risk-free path,” Fed Chair Jerome Powell said Wednesday, emphasizing that the central bank must balance inflation concerns with slowing job growth.
Meta (META)
Meta’s annual Connect event showcased new AI-powered glasses, positioning the company at the forefront of mixed-reality computing. JP Morgan praised the innovation, noting Meta’s continued investment strength—even as its core advertising business remains profitable.
- Pre-market: +0.90%
- Previous close: $775.72
Disney (DIS)
Shares of Disney are steady after pulling “Jimmy Kimmel Live!” from air in response to backlash over on-air remarks following the death of political activist Charlie Kirk. The move came amid threats from Nexstar Media and scrutiny from the FCC.
- Pre-market: +0.32%
- Previous close: $116.10
FedEx (FDX)
Investors are watching FedEx closely as the company prepares to report quarterly earnings after the bell. Analysts warn profits could be impacted by Trump’s decision to revoke the “de minimis” tariff exemption on low-value imports from China and Hong Kong.
Oil holds steady as investors eye demand
Oil prices were flat overnight, even after the Fed’s decision. Traders are weighing the rate cut’s potential effect on global demand.
- Brent Crude: $67.46 (-0.72%)
- WTI Crude: $63.95 (-0.16%)
The Energy Information Administration reported a sharp drop in U.S. crude stockpiles, with exports near a two-year high—signs that may support prices if demand rises in coming weeks.
What to watch next
- Weekly jobless claims: Released today, will offer more insight into labor market trends
- FedEx earnings: Could show ripple effects of tariff changes
- Trump’s UK visit: Ongoing meetings on tech and AI investment may influence sentiment around Microsoft (MSFT), Nvidia (NVDA), and other majors
Meanwhile, investors remain cautious. Powell’s warning that “high inflation and a weak labor market leave no risk-free path” suggests the road ahead could still be volatile—even with rate cuts on the table.