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US futures hold as Nvidia rally cools; rate cuts in focus By Investing.com

Investing.com– U.S. stock index futures were slightly lower in late trading on Wednesday as a rally in tech stocks, notably Nvidia, fizzled out as investors worried about an upcoming rate decision interest from the Federal Reserve.

Technology gains helped Wall Street shake off early losses and close Wednesday, even as a stronger reading on core consumer inflation hurt expectations of a flash interest rate cut by the Fed.

Tech gains also helped markets look past heightened political uncertainty after a heated presidential debate between Vice President Kamala Harris and former President Donald Trump, in which Harris was seen gaining an edge over Trump.

fell 0.1% to 5,558.0 points, while it was down 0.1% to 19,252.50 points by 20:12 ET (00:12 GMT). settled at 40,893.0 points.

Nvidia falls in aftermarket trade, tech rally cools

NVIDIA Corporation (NASDAQ: ) — which was at the center of Wednesday’s Wall Street rally — fell 0.2% in aftermarket trade, after rising more than 8% during the session.

The chipmaker’s gains were largely driven by upbeat comments from CEO Jensen Huang, who signaled strong demand for its products, particularly its newest line of artificial intelligence chips called Blackwell.

Nvidia’s gains spilled over into broader technology stocks on hopes that AI-fueled demand will help support the sector. But the sector was still suffering a steep decline since last week.

It rose 1% to 5,554.10 points, while on Wednesday it rose 2.1% to 17,391.16 points. It increased by 0.3% to 40,861.71 points.

Strong CPI reading weakens protection rate lowered hopes

A stronger-than-expected reading on inflation caused investors to largely pare bets that the Fed will cut interest rates by 50 basis points in September.

Although still softened in August, the stronger core reading raised some concerns about inflation remaining sticky.

Traders were seen pricing in an 84% chance of a 25 basis point discount, up from earlier expectations of a 66% chance. The odds of a 50 bps point fell to 16% from the previous expectation of 34%.

But the Fed is still expected to cut rates by 25 bps to a , starting an easing cycle that could bring more rate cuts later this year.

Before that, data due later Thursday will provide more clues on US inflation and will be closely watched, especially after the strong CPI reading.

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