US Stocks Set for Higher Open as Tech Shares Rise and Oil Prices Retreat

The benchmark 10-year US Treasury yield moved back below 5%, falling to around 4.95%. The yield had climbed above 5% after the Fed announced its policy decision on Wednesday.

Lower Treasury yields reduced some pressure on equities, particularly technology companies. Higher government bond yields can make risk-free assets more competitive with stocks and increase financing costs for businesses.

The Federal Reserve raised its benchmark rate by 25 basis points to a target range of 3.75% to 4%. It marked the central bank’s first rate increase since 2023.

Fed Chair Kevin Warsh maintained a firm stance on inflation, while policymakers indicated that another increase could come before the end of the year. Traders placed the chance of another hike at the October meeting at around 53%, up from about 44% a day earlier.

Chris Zaccarelli, Chief Investment Officer at Northlight Asset Management, said Warsh ‘threaded the needle very well.’ He also noted that inflation had remained above the Fed’s target for several years.

Kim Forrest, Chief Investment Officer at Bokeh Capital Partners, said: “It doesn’t feel like we’ve entered the type of rate-hiking cycle we saw in 2022 and 2023.”