U.S. Stock Index Futures Higher Amid Inflation Data

U.S. stock index futures increased on Sunday evening, buoyed by softer inflation data, but investors prepared for a slower pace of interest rate cuts ahead.

The Federal Reserve indicated fewer expected rate cuts for 2025 last week, leading to significant losses in Wall Street indexes over two consecutive days and weekly losses.

• S&P 500 Futures rose 0.3% to 6,020.50 points
• Nasdaq 100 Futures gained 0.4% to 21,655.25 points
• Dow Jones Futures were up 0.3% at 43,425.0 points

Investors Assess PCE Data, Fed Comments for Rate Outlook

The PCE price index—a key inflation measure for the Federal Reserve—rose by 0.1% in November, slowing from a 0.2% increase in October, bringing the annual PCE inflation rate to 2.4%, slightly lower than the anticipated 2.5%.

Despite the cooling inflation data, it remained above the Fed’s 2% target, indicating that inflation pressures persist. The Fed emphasized a cautious stance on monetary policy adjustments, needing further progress on inflation before considering additional rate cuts.

Recent comments from Fed officials revealed that fiscal policy uncertainties, including tariffs, influenced their outlooks. Officials expressed uncertainty about how Donald Trump's administration policies might impact interest rates, prompting predictions of fewer cuts in 2025.

Following a 25 basis point rate cut on Wednesday, the Fed forecasts just two cuts in 2025, down from four previously expected.

Wall Street Rallies After Two-Day Slump, Tech Rebounds

After a two-day decline, Wall Street indexes rebounded on Friday but ended lower for the week, as higher rate expectations drove indexes down earlier. Technology stocks, which fell post-Fed decision, saw recovery on Friday.

• NVIDIA Corporation (NVDA) jumped 3.1%
• Micron Technology Inc (MU) increased 3.5%
• Broadcom Inc (AVGO) shares rose 1.1%
• Intel Corporation (INTC) gained 2.4%
• Conversely, Tesla Inc (TSLA) dropped nearly 3.5%.

On Friday, the S&P 500 climbed 1.1% to 5,930.90 points, the Dow Jones Industrial Average rose 1.2% to 42,841.06, and the NASDAQ Composite gained 1% to 19,572.60 points.

For the week, the S&P 500 decreased nearly 2%, the Nasdaq fell 1.8%, and the Dow dropped 2.3%.