U.S. stock futures on Thursday pointed to a second straight decline after the Federal Reserve opted to close out the year with a more aggressive posture than investors anticipated.
What’s happening
-
Futures on the Dow Jones Industrial Average
YM00,
-0.85%
fell 275 points, or 0.8%, to 33964. -
Futures on the S&P 500
ES00,
-1.12%
dropped 41.75 points, or 1%, to 3989. -
Futures on the Nasdaq 100
NQ00,
-1.38%
decreased 158.75 points, or 1.3%, to 11710.
On Wednesday, the Dow Jones Industrial Average
DJIA,
fell 142 points, or 0.42%, to 33966, the S&P 500
SPX,
declined 24 points, or 0.61%, to 3995, and the Nasdaq Composite
COMP,
dropped 86 points, or 0.76%, to 11171.
What’s driving markets
Investors were still focused on Wednesday’s Federal Reserve decision. Not only did the Fed’s dot plot for 2023 come in higher than forecast, Chair Jerome Powell spent his press conference pushing back on the idea the central bank will cut rates next year.
Read: Powell paints hawkish picture at press conference
“He pushed back heavily on the idea that the Fed may cut rates next year, arguing that instead the Fed are looking for an extended period of pause, citing the risks of premature loosening. He said that the FOMC wouldn’t consider rate cuts until it is confident that inflation is moving back down to 2% in a sustained way, trying to dampen expectations for rate cuts next year, yet arguably this does still leave the door open for 2023 rate cuts,” said Ellie Henderson, an economist at Investec in London.
The Bank of England and European Central Bank each are expected to join the Fed in lifting interest rates by a half point. The dollar
DXY,
was rising in early Thursday action.
There’s also a big slate of economic data: weekly jobless claims, the Empire and Philadelphia Fed manufacturing indexes, retail sales, industrial production and business inventories.
Also in the spotlight is Tesla
TSLA,
after CEO Elon Musk disclosed in a Securities and Exchange Commission filing that he sold $3.6 billion worth of shares. Tesla shares, which have slumped 55% this year in the wake of both higher interest rates and Musk’s $44 billion purchase of Twitter, fell 4% in premarket trade.